新主席、旧通胀、超预期就业：沃什首秀后，全球资产如何重新定价？

Last week, newly appointed Federal Reserve Chair Kevin Warsh delivered his first monetary policy report since taking office.

The Federal Open Market Committee decided to hold the federal funds rate target range steady at 3.50%—3.75%, with all 12 voting members in favor and no dissenting votes (for further reading: On the Eve of Warsh's Debut: More Important Than Rate Cuts, How Will the Fed Reshape Expectations?), marking a rather uneventful "holding pattern."

At the same time, however, the policy statement was compressed into three paragraphs totaling about 100 words — significantly shorter than previous meetings. Some language previously used to describe risk balance, future policy adjustments, and data dependency was directly deleted, and even the "forward guidance" that markets had grown accustomed to for years was eliminated.

Warsh explicitly stated at the press conference that the new statement is "shorter, simpler, and removes some old language." In his view, having lived through the most severe phase of the 2008 financial crisis, the current environment changes too quickly, and the Fed should not prematurely commit to future actions but should instead refocus the market's attention on economic data itself.

This may be the real signal sent by the June FOMC meeting: The Fed under Warsh is no longer trying to reduce uncertainty for the markets but is prepared to return some of that uncertainty back to them.

A new communication framework has begun.

1. Rates Unchanged, but the Fed's Policy Language Has Changed

For many investors, Warsh is still a relatively unfamiliar name.

But he is no newcomer to the Fed. Serving as a Fed governor from 2006 to 2011, Warsh witnessed the 2008 financial crisis and the subsequent quantitative easing process. After leaving the Fed, he has long criticized the central bank's excessive balance sheet expansion, the proliferation of forward guidance, and monetary policy's over-intervention in financial markets.

Therefore, rather than reducing market volatility through repeated policy hints, Warsh places greater trust in price signals and emphasizes monetary discipline. His core philosophy can be summarized as: "The central bank should articulate its objectives clearly, but it doesn't need to reveal every operational step to the market in advance."

This approach was fully reflected in his first FOMC meeting.

Beyond eliminating forward guidance, Warsh also refused to submit his own rate path in this economic forecast. He believes the current dot plot is easily misinterpreted by the market as a policy commitment, whereas each dot is merely a conditional projection by officials based on information available at the time.

He even described the officials' projections as being made with "pencils equipped with large erasers" — as soon as data changes, forecasts can be erased and rewritten at any moment.

However, even though Warsh tried to downplay the importance of the dot plot, the market still saw a very clear shift. Among the 18 participants who submitted forecasts, 9 expect at least one rate hike by the end of 2026, 8 expect rates to remain unchanged, and only 1 expects a rate cut.

More notably, of the 9 who anticipate a rate hike, 3 expect one hike, 5 expect two hikes, and 1 expects three hikes. The median year-end policy rate rose from 3.4% forecast in March to 3.8%, meaning that under the median scenario, the Fed will not only refrain from cutting rates this year but may actually raise rates by 25 basis points.

Simultaneously, the Fed significantly raised its 2026 PCE inflation forecast from 2.7% in March to 3.6%, and its core PCE forecast from 2.7% to 3.3%.

In other words, the message from the June meeting was straightforward: The economy is not weak enough to require rescue, yet inflation is already too strong to continue discussing rate cuts. This is why the market's once-anticipated "Warsh rate cut trade" quickly faded after his debut.

Furthermore, when Trump nominated Warsh, the market widely speculated that the new chair might be more inclined to cut rates than his predecessor. But Warsh made it clear during his confirmation hearing that the president never asked him to pre-commit to any rate decision, and even if such a request were made, he would not accept it.

As it stands, Warsh is not in a rush to prove whether he is a hawk or a dove. What he first aims to prove is that the Fed still has the ability to say no to inflation.

2. What Kind of "Hot Potato" Did Warsh Inherit?

Objectively speaking, Warsh's first major challenge remains inflation.

The U.S. headline PCE rose 3.8% year-over-year in April, while core PCE increased 3.3%, still significantly above the Fed's long-term target of 2%.

Compounding the issue, the current inflation is not driven by a single factor.

On one hand, energy prices and geopolitical tensions continue to impact upstream costs; on the other hand, supply chains, tariffs, and service prices are generating broader transmission pressure. If energy price increases further spill over into transportation, manufacturing, and consumer spending, the Fed will no longer be dealing with a short-term shock but rather the risk of inflation expectations re-anchoring higher.

At the same time, the labor market is far stronger than markets had previously anticipated. The U.S. employment report for May, released on June 5, showed nonfarm payrolls increased by 172,000 — roughly double market expectations — while the unemployment rate held steady at 4.3%.

Under normal circumstances, this would be welcome data. But in the current environment, "good economic news" was interpreted by the market as "bad news for monetary policy." On the day of the employment report, the Nasdaq Composite fell 4.18%, its largest single-day drop in over a year. Semiconductor and high-valuation tech stocks were hit hardest, while bond yields rose noticeably.

Trump subsequently posted on Truth Social, writing in bewilderment: "The jobs report is so good, stocks should be going up, not down. That's how it's been for 200 years."

This precisely reveals the most contradictory aspect of the current market. Warsh has not inherited an economy on its last legs, desperately needing central bank rescue through unlimited quantitative easing like during the pandemic. Instead, he has inherited an economy that, much like in 1994, displays strong vital signs on the surface but harbors stagflation risks, poised to stall due to a single monetary policy misstep.

Now, rate hikes risk crushing the recovery, while rate cuts risk reigniting inflation. This is precisely his most difficult predicament.

This is also why Warsh is not actually facing a binary "hike or cut" choice but rather a challenge of precise timing in policy execution.

Notably, the Fed saw four dissenting votes in April this year — the first instance of such large-scale internal dissent since 1992. And this division did not appear suddenly. Over the past two years, internal rifts at the Fed have been accumulating: Doves believe the labor market has cooled and that rate cuts should commence promptly to prevent a hard landing; hawks insist inflation has not been truly tamed and that cutting rates would undo all progress.

The unexpectedly large 50-basis-point rate cut in September 2024 sparked intense internal controversy. Then-Governor Michelle Bowman dissented, becoming the first Fed governor in nearly two decades to publicly oppose the chair on a rate decision. Trump's appointment of new members and his pressure on the Fed's independence have further injected political overtones into monetary policy discussions at an alarming rate.

Thus, Warsh has taken over a team deeply divided on policy direction. The chair may have changed, but the accumulated disagreements have not dissipated. Warsh hasn't just inherited a position; he's inherited a powder keg that could explode at any FOMC meeting.

Building internal consensus is itself the first test Warsh faces.

3. How Are Global Assets Being Repriced?

For the markets, the hawkish undertones of this FOMC meeting have also become a stock market direction indicator.

First and foremost are the most direct rate trades: the U.S. dollar and U.S. Treasuries.

At the asset level, the logic for the long-dollar ETF UUP.M is relatively straightforward. The higher the market's expectation for the policy rate, the more pronounced the yield advantage of U.S. assets relative to other currency assets typically becomes. Hence, the dollar index rose about 0.5% after the June FOMC meeting, reflecting the market's repricing of potential rate hikes.

The environment for the intermediate-term Treasury ETF IEF.M is more complex. As is well known, bond prices move inversely to yields. If inflation forecasts continue to be revised upward and the market further bets on rate hikes, intermediate-term Treasury yields may remain elevated, putting pressure on IEF.M.

However, this does not mean U.S. Treasuries are on a one-way downward path. Should employment or consumption data suddenly weaken, triggering recession fears, safe-haven capital could quickly flow back into government bonds. Therefore, what influences U.S. Treasuries is not just whether the Fed will hike next but also how the market assesses growth prospects following any hike.

Gold ETFs like GLD.M and IAU.M are currently assets that investors find relatively difficult to allocate. High real interest rates theoretically suppress gold, but geopolitical risks in the Middle East and continued central bank gold purchases provide another source of support. When these two forces pull in opposite directions, gold is better understood as a hedging exposure rather than an offensive allocation.

Silver ETFs like SLV.M and SIVR.M have an additional industrial logic compared to gold. The AI infrastructure buildout's demand for electricity infrastructure and industrial metals provides silver with independent demand support beyond its monetary properties, giving it an extra layer of cushion under the same macroeconomic pressure.

The impact of high rates on the AI infrastructure theme can be analyzed on two levels and cannot be simply dismissed as "rate hikes doom AI infrastructure":

• The first is valuation pressure: For semiconductor equipment stocks like LRCX.M and KLAC.M, optical communication stocks like LITE.M and AAOI.M, memory stocks like MU.M and SNDK.M, and power infrastructure stocks like VRT.M and GEV.M, their valuations are based on revenues expected to materialize over several years. The higher the interest rate, the higher the discount rate, and the lower the present value of future cash flows;
• The second layer is capital expenditure risk: Cloud providers' AI CapEx is the lifeblood of the entire chain. In a high-rate environment with rising financing costs, might cloud providers tighten their budgets? For now, Microsoft, Google, and Amazon are still expanding their CapEx, and the demand-side logic has not changed due to rate hikes. Furthermore, rates suppress valuations, not order volumes. As long as cloud CapEx does not contract, the industrial logic for AI infrastructure remains intact, even if the space for valuation expansion is compressed. Reviewing Google's Q1 2026 performance confirms this conclusion.

The defense sector also possesses certain defensive attributes.

Companies like LMT.M, NOC.M, and RTX.M derive most of their revenue from long-term government contracts, offering higher visibility into orders and cash flows compared to high-valuation growth stocks. During periods of elevated rates, when the market favors certainty in cash flows, defense assets may gain a relative advantage.

However, this does not mean defense stocks are completely immune to interest rate impacts. Rising yields can still suppress their valuations. What truly provides support is the policy certainty of defense budgets and long-term orders, not absolute immunity from rate risks.

4. Looking Ahead, What Should the Market Really Watch?

Warsh's first FOMC meeting has provided an initial answer: The Fed is not prepared to continue mapping out every policy step for the market. Future volatility will be more driven by data itself.

But this is still just the beginning. In the coming months, several key nodes warrant sustained investor attention.

First is the June nonfarm payrolls report on July 2. This will be the first full-month employment report under Warsh's tenure and the most important labor market signal he receives before the July meeting. If job growth remains robust, the window for rate cuts closes further, and discussions of rate hikes will transition from expectation to reality. If the data weakens significantly, market expectations for the monetary policy path could loosen again, providing room for repricing the logic of rate cuts.

Therefore, this data point could directly determine the tone of the July meeting.

Second is the June CPI report in mid-July, the most critical data point between the two FOMC meetings. Warsh made it very clear at the press conference that price stability is the current primary objective. If CPI remains stubborn, his stance at the July meeting will only become more hawkish; if inflation shows a substantial decline, the market will be divided on his next move. Regardless of the outcome, this data will trigger significant volatility on the day of its release.

Finally, the second FOMC meeting on July 28-29 could be the first rate decision truly belonging to Warsh. By July, with nonfarm payrolls and CPI data accumulated, he will need to make a real policy choice. By then, the market's assessment of him will be clearer, and the direction's outline will be more complete.

Of course, the midterm elections in the second half of the year are undoubtedly a longer-term variable. As the elections approach, the tension between the White House and the Fed is destined to be amplified again. Trump's desire for rate cuts will not disappear, and Warsh's statement at the hearing that "I won't agree" will be repeatedly tested each time political pressure intensifies.

The proposition of monetary policy independence will persist as a background noise for the markets throughout the second half of the year.