Kevin Warsh, the Federal Reserve chairman, has taken control of the institution by letting markets guess where his policy is heading, notably after the September rate hike despite inflation remaining above the 2% target. He laid the groundwork for a possible December increase if inflation persists, while refusing to commit to a fixed course. Warsh is also reshaping the Fed by reducing the number of interest-rate votes: one meeting in 2027 and two in 2028 will not include a rate decision, and regional presidents will have fewer scheduled rotations as voters. This approach preserves his room to maneuver and makes public comments by officials less consequential, but it has drawn criticism. Robert Sockin, chief U.S. economist at PGIM, said holding rates steady was a policy mistake that mechanically raises the risk of recession.
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