TechFlow News, March 23: According to JIN10 Data, Nick Timiraos—the so-called “Fed whisperer”—stated that surging energy prices have made the Federal Reserve’s already difficult leadership transition even more challenging.
This transition was already highly complex. Kevin Warsh’s nomination has stalled due to a Department of Justice investigation and opposition from Senator Thom Tillis. Moreover, unlike every Fed chair since Paul Volcker, Warsh has pledged a clean break from his predecessor’s policies rather than continuing them.
Markets now anticipate an equal probability of rate hikes and cuts this year—potentially placing Warsh in a bind between the president who nominated him and the committee he is set to lead.
In 2008, oil prices surged abruptly following an aggressive easing cycle. At the time, Warsh forcefully argued that inflation risk “was the primary risk” and recommended that the Fed’s next move be a rate hike—precisely the opposite of what Trump expects.
