Bank of America doubts Fed Chair Warsh’s credibility after rate-hold decision
Bank of America said on August 3 that Fed Chair Kevin Warsh’s recent dovish comments have heightened investors’ inflation concerns, sparked market volatility and cast doubt on his leadership. The criticism came after the Federal Open Market Committee left its benchmark interest rate unchanged at its July 29 meeting, despite core inflation remaining above target. Analysts had expected the hold, noting mixed inflation data and rising oil prices, while Warsh faced growing pressure from Fed officials and market observers to raise rates.
On the same day, the 30-year Treasury yield rose to its highest level since 2007 and the S&P 500 fell 1. 5 %, after which three Fed officials who voted against the hold called for immediate hikes. President Trump also continued to urge the Fed to cut rates ahead of the midterm elections.