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● LIVE Updated 13h ago · 9 sources tracked

'The bond market has taken down more governments than howitzers': Scott Bessent cuts Kevin Warsh some slack ahead of anticipated rate meeting

The Federal Reserve is expected to raise interest rates, which would mark the first such increase during Kevin Warsh's tenure. This anticipated move defies demands from Donald Trump and threatens the truce established between Trump and the central bank upon Warsh's arrival. While investors and analysts anticipate the hike, Scott Bessent has offered support for Warsh, noting that the bond market has taken down more governments than howitzers. Warsh now faces a difficult internal vote as the Fed prepares for the meeting.

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⚡ Key Developments & Real-Time Context
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  • ✓ The Federal Reserve is expected to raise interest rates.
  • ✓ A rate hike would be the first under Kevin Warsh.
  • ✓ Investors expect the Fed to raise rates despite demands from Donald Trump.
🛡️ Source Corroboration: 9 independent reporting domains (90% confidence) ⏱ Read time: ~2 min

What changed

Scott Bessent publicly defended Kevin Warsh as the Fed prepares for an expected interest rate hike.

Live updates

  1. Federal Reserve prepares for first rate hike under Kevin Warsh

    The Federal Reserve is expected to raise interest rates, which would mark the first such increase during Kevin Warsh's tenure. This anticipated move defies demands from Donald Trump and threatens the truce established between Trump and the central bank upon Warsh's arrival. While investors and analysts anticipate the hike, Scott Bessent has offered support for Warsh, noting that the bond market has taken down more governments than howitzers. Warsh now faces a difficult internal vote as the Fed prepares for the meeting.

    Why it matters

    Central bank rate decisions influence the broader economy and household finances through their impact on Treasury bond yields. Warsh's leadership previously ended a period of conflict between the presidency and the Fed. A rate hike now risks restarting that friction.

    What is confirmed

    • The Federal Reserve is expected to raise interest rates.
    • A rate hike would be the first under Kevin Warsh.
    • Investors expect the Fed to raise rates despite demands from Donald Trump.

    Still unconfirmed

    • Warsh faces a tough battle regarding the vote for the rate hike.

    What to watch next

    • The official Federal Reserve rate meeting decision
    • Donald Trump's response to a potential rate hike
    • Further communication from the Fed regarding July's communications issues
    Sources used for this update (9)
    1. The Economist — Kevin Warsh should raise interest rates
    2. Financial Times — Warsh and Trump on collision course as investors expect Fed to raise rates
    3. Reuters — Fed's table is set for a rate hike, a first under Warsh
    4. Fortune — 'The bond market has taken down more governments than howitzers': Scott Bessent cuts Kevin Warsh some slack ahead of anticipated rate meeting
    5. CNBC — Counting the votes: Warsh faces a tough battle as the Fed girds for expected interest rate hike
    6. axios.com — How Warsh can avoid a repeat of July's communications mess
    7. WSJ — Warsh’s Arrival Ended Trump’s War With the Fed. A Rate Hike Would Test the Truce.
    8. AP News — Federal Reserve is expected to raise its benchmark rate, defying Trump’s demands
    9. www.nbcnews.com — How a 5% yield on 10-year Treasury bonds affects everyone
    confidence 90%
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