Warsh's Jackson Hole Gambit: Fed Rate Hike Bets Surge as Trump Trade War Escalates

The global economy is at a tense inflection point after Federal Reserve Chair Kevin Warsh delivered a hawkish speech at Jackson Hole, signaling that rate hikes could be necessary to combat stubborn inflation. His comments immediately sent the CME FedWatch Tool probability for a September 25 basis-point hike soaring to 60%, up sharply from 35% the day prior. Markets are now pricing in a near coin-flip chance of tightening, a dramatic shift from the easing...