Quick Read – PCE inflation hit 4.1% in May, which is more than double the Fed’s 2% target, making the case for rate cuts nearly impossible. – Warsh signaled restoring Fed credibility takes priority over Trump’s push for lower rates, driving rate-hike odds to 54%. – WTI crude…
mbling below $70 could filter through supply chains and give the Fed cover to hold rates steady in July. – For much of the past year, investors have focused on one question: when will interest rates come down? President Trump has made no secret of where he stands
He has repeatedly criticized the Federal Reserve for keeping rates too high and argued that lower borrowing costs are needed to support economic growth. His decision to nominate Kevin Warsh as Federal Reserve chair was widely viewed as a move toward a more accommodative central bank. Yet inflation has a way of rewriting the script.
Fresh data from the Bureau of Economic Analysis (BEA) suggests the Fed’s inflation fight is far from over, setting up a potentially uncomfortable clash between the White House and the nation’s top central banker. Inflation Is Moving in the Wrong Direction The BEA reported that the Personal Consumption Expenditures (PCE) Price Index rose to 4.1% in May, the highest reading since April 2023 and more than double the Federal Reserve’s 2% target. That alone would be enough to grab investors’ attention.