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Federal Reserve New Governor Wash is set to make his debut, and the market expects the benchmark interest rate to remain at 3.50%–3.75%
Svmuu News: Global financial markets will be watching Washington closely this week, as the Federal Reserve’s new chairman, Kevin Warsh, hosts his first press conference following a Federal Open Market Committee meeting since taking office.This marks not only his transition from policy commentator to “the world’s most powerful banker,” but also a critical window for observers to gauge Federal Reserve whether monetary policy will undergo a major shift. The market widely expects Federal Reserve to keep the benchmark interest rate range at 3.50%–3.75% unchanged at this week’s meeting.Rather than the specific interest rate decision, the market is more focused on how Wash will reshape Federal Reserve’s “art of communication.” For a long time, former Chair Jerome Powell preferred to guide market expectations through transparent “forward guidance,” but Wash has previously expressed reservations about this approach, arguing that Federal Reserve should not provide the market with excessive hints regarding interest rates. This meeting will also see the release of the latest Quarterly Economic Forecast (SEP) and the “dot plot.” For Wash, who is extremely averse to the dot plot, this is undoubtedly an awkward start, as he must strike a balance between respecting the Federal Reserve’s decision-making process and expressing his personal policy views. (Reuters)
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