New Federal Reserve Chair Kevin Warsh will oversee his first policy meeting on Wednesday. The Fed is likely to keep its key interest rate unchanged at about 3.6% for the fourth straight meeting, according to economists.

Warsh’s First Press Conference

Warsh, previously an investment banker and a member of the Fed’s board of governors from 2006-2011, will hold his first press conference in the afternoon. This event will be closely watched by Wall Street investors, economists, and the White House to see how Warsh conducts himself.

Fed-watchers will look for clues about the future of interest rates, how the Fed will address elevated inflation, and potential changes to the Fed’s communication practices. Warsh has expressed his desire to lower the Fed’s public profile and reduce its commentary on the economy.

The economic environment has changed significantly since Warsh appeared to campaign for the job of Fed chair last year. At that time, he was outspoken in favor of lower interest rates, citing the development of AI as a technology that could expand the economy’s ability to produce goods and services cheaply. However, many economists were skeptical of his claim, and the current inflation rate has accelerated to a three-year high of 4.2%.

President Trump has announced an initial peace agreement that could bring an end to the three-month conflict in the Middle East, but it’s unclear if peace will hold. Even if oil flows freely again, it could take months for prices to cool. The Fed typically fights higher inflation by raising its key interest rate to cool spending and growth.

Original reporting: KCCI Des Moines — read the source article.