BANGKOK – Federal Reserve Chairman Kevin Warsh stopped short of indicating whether there will be another interest rate hike this month, although he acknowledged a “synchronous adjustment” by central banks around the world and that “there are no free riders.” “I don’t prejudge meetings. I don’t believe in saying now what I might do in meetings we have later this year,” Warsh said, reiterating his opposition to using forward guidance for markets that should depend on interpretation of data. He also acknowledged that such a stance may disappoint anyone who had hoped for a change before the central bank meeting later this month. “It’s a new chapter at the Federal Reserve [and] We’re not in that business anymore. But we can go in any direction you want,” he said. Warsh spoke at a fireside chat with International Monetary Fund Managing Director Kristalina Georgieva as part of the week-long IMF-World Bank Annual Meetings in Bangkok on Friday. S&P 500 and Nasdaq futures rose after the speech, while stock indexes in Asia and Treasury yields were largely stable. Warsh described the global shift toward tighter monetary policy as a common fight over prices. Banks made their own decisions under their own mandates, he said, but the result was “a synchronous tightening of monetary policy in most places around the world,” meaning “there are no free riders.” Rising energy costs stemming from the Iran war and the boom in artificial intelligence investment are fueling inflation and raising borrowing costs around the world, just as global public debt is on track to decline. exceed 100% of global GDP, a level last surpassed after World War II. It has insisted that strong growth would be the best way out of its mounting debt, dismissing the IMF’s warning that plans to rely solely on growth will not work as something to be taken “with a grain of salt.” bumpy” and its short-term effect on jobs is still uncertain. “I want you to hear optimism from me, but optimism fueled by seriousness.” A decade from now, he said, people will look back on the events and “say this had huge consequences.” The Federal Reserve raised rates to a range of 3.75% to 4% last month, its first hike since 2023. Traders see a 72.3% chance the Fed will hold the interest rate on hold. unchanged at the October 27-28 meeting, according to CME FedWatch, while most expect a 25 basis point hike at the December meeting.
