JPMorgan brings forward Fed hike call to December 2026 after Warsh press conference
The bank shifted its forecast from the second half of 2027 after a Treasury selloff following Kevin Warsh's press conference, while CEO Jamie Dimon backed the Fed chairman's retreat from forward guidance.
JPMorgan has moved forward its forecast for a 25-basis-point Federal Reserve rate increase to December 2026 from the second half of 2027 after Treasury markets sold off following Federal Reserve Chairman Kevin Warsh's latest press conference. The 30-year Treasury yield rose above 5.20%, its highest level since the 2007 financial crisis, as investors weighed Warsh's reduced use of forward guidance, possible changes to inflation frameworks and his message that markets should "play the ball, not the referee." Prediction markets also repriced, while JPMorgan Chase CEO Jamie Dimon endorsed Warsh's communications reset as sensible even as critics said the Fed had become less transparent; Warsh's five task forces are reviewing communication, data quality, the balance sheet, AI-linked productivity and inflation frameworks, with findings due early next year.
- Forward guidance: Central bank communication about the likely future path of interest rates or policy.
- Basis point: One-hundredth of a percentage point; a 25-basis-point move equals 0.25 percentage point.
- FOMC: The Federal Open Market Committee, the Federal Reserve body that sets US monetary policy.