Minutes of the Federal Reserve’s June 16-17 meeting, the first held under Chairman Kevin Warsh, released July 8, confirmed an open split at the central bank over whether its next move is up, CNBC reports. Nine of the eighteen policymakers now project at least one rate hike in 2026, against none in March, and seventeen of eighteen think inflation risks are increasing. Warsh withheld his own projection, leaving the minutes as the committee’s clearest on-record signal. The markets have now priced the odds of a hike by October near 90%.
With inflation stoked by the oil shock from the renewed Iran war, the Fed is preparing to tighten, raising the cost of every dollar the developing world must roll over and every dollar the U.S. productive economy needs to build. The “family fight” is a quarrel over how hard to squeeze, not whether.
