Story perspectives

Senate Confirms Warsh as Fed Chair; Rate Cut Unlikely

5/15/2026

Summary

Warsh Confirmed

Senate confirmed Kevin Warsh as Federal Reserve (Fed) chair on May 13, 2026, by a 54-45 vote.
Warsh will chair the June 16-17 Fed meeting after CPI 3.8% and PPI 1.4%.
He told senators he will coordinate with President Donald Trump and reduce balance sheet.
Prediction markets price a near-zero chance of a 2026 rate cut (Kalshi 70%, Polymarket 71%).
Bond analysts warn a dovish Warsh could spook bonds and raise inflation expectations.

Summary

Producer Prices Surge

Producer prices rose 6% YoY in April 2026, steepest since early 2022, as war-related energy spikes lifted the index, with energy components up 7.8% amid Strait of Hormuz disruptions.
The 10-year Treasury note rose to 4.484%, while the Dow fell 249.05 points to 49,511.51 and the Nasdaq edged 3.40 points.
Boston Federal Reserve (Fed) President Susan Collins urged keeping policy slightly restrictive because inflation has stayed above target for over five years.

Summary

Fed Dissenters

Three voting Federal Open Market Committee members—Hammack, Kashkari and Logan—dissented from the April easing bias.
Boston Fed President Susan Collins also called for dropping the easing bias, while Wall Street expects the June 16-17 meeting to eliminate it and tighten policy.
Ed Yardeni, president of Yardeni Research, said the 2-year Treasury yield above the federal funds rate and market participants’ view of a five-year inflation overshoot justify a rate hike.

Summary

Powell Stays

Fed Chair Jerome Powell will stay on as a Federal Reserve governor while the Trump administration’s legal attacks persist.
Fed Governor Collins, who is not a voting Federal Open Market Committee (FOMC) member, says tariff pass-through and expectations are inflation risks and urges dropping language about rate cuts.
She warns that even a swift end to the U.S.–Israel war with Iran could disrupt supply chains and affect the U.S. economy.

History

Historical Context

After President Jimmy Carter named Paul Volcker Fed chairman in July 1979, Volcker raised the federal funds rate to a 20 % peak in June 1981, slashing inflation from a 14.8 % high to below 3 % by 1983. In 2026, the Senate confirmed Kevin Warsh, echoing Volcker’s tough stance as the Fed battles a 3.8 % CPI rise.

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Warsh Confirmed

Senate confirmed Kevin Warsh as Federal Reserve (Fed) chair on May 13, 2026, by a 54-45 vote.
Warsh will chair the June 16-17 Fed meeting after CPI 3.8% and PPI 1.4%.
He told senators he will coordinate with President Donald Trump and reduce balance sheet.
Prediction markets price a near-zero chance of a 2026 rate cut (Kalshi 70%, Polymarket 71%).
Bond analysts warn a dovish Warsh could spook bonds and raise inflation expectations.

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