Kevin Warsh has held rates steady at 3.50-3.75% through his first two FOMC meetings while sharply scaling back the Fed's forward guidance, forcing markets to interpret Fed policy for themselves for the first time since the Financial Crisis. In this month's Market Insight, we assess how that shift has driven a steeper curve and rising term premium, and why it reinforces our underweight to government bonds alongside sticky inflation, high deficits, and elevated political risk.
Kevin Warsh has held rates steady at 3.50-3.75% through his first two FOMC meetings while sharply scaling back the Fed's forward guidance, forcing markets to interpret Fed policy for themselves for the first time since the Financial Crisis. In this month's Market Insight, we assess how that shift has driven a steeper curve and rising term premium, and why it reinforces our underweight to government bonds alongside sticky inflation, high deficits, and elevated political risk.
Kevin Warsh has held rates steady at 3.50-3.75% through his first two FOMC meetings while sharply scaling back the Fed's forward guidance, forcing markets to interpret Fed policy for themselves for the first time since the Financial Crisis. In this month's Market Insight, we assess how that shift has driven a steeper curve and rising term premium, and why it reinforces our underweight to government bonds alongside sticky inflation, high deficits, and elevated political risk.
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