The June Federal Open Market Committee (FOMC) meeting dispelled any fears about a potential politicisation of the Federal Reserve via the appointment of Kevin Warsh as its new Chair. The FOMC statement, and Warsh’s own commentary, emphasised a commitment to delivering price stability. The summary of economic projections, meanwhile, showed the FOMC split right down the middle on whether to raise interest rates this year. Markets swiftly moved from pricing an 80% probability of a 25bp hike later this year to fully discounting one-and-a-half 25bp hikes. The softer‑than‑anticipated June CPI, the benign PPI readings, ... (full story)