Source Details

{
    "source_type": "extension",
    "content_hash": "43f462e75b0a0d47796e64c1d744d1467017c47f072abf0b5ce9d33d1a17f113",
    "submitted_via": "chrome_extension",
    "extension_version": "1.0.18",
    "original_url": "https:\/\/www.nytimes.com\/2026\/09\/17\/business\/economy\/fed-interest-rates-warsh.html?emc=edit_nn_20260917&nl=the-morning&segment_id=226633",
    "parsed_content": "U.S. EconomyFed MeetingInterest Rates RisePoverty RateKey Borrowing RateElevated InflationGas PricesAdvertisementSKIP ADVERTISEMENTSupported bySKIP ADVERTISEMENTThe Fed, After Raising Rates, Grapples With What Comes NextKevin M. Warsh, the chairman of the Federal Reserve, on Wednesday left open-ended how much more interest rates may have to rise to tame inflation.Listen \u00b7 8:08 min Share full articleKevin M. Warsh exiting after delivering remarks in Washington on Wednesday.Credit...Andrew Harnik\/Getty ImagesBy Colby SmithColby Smith covers the Federal Reserve.Sept. 17, 2026, 5:05 a.m. ETSee more of our coverage in your search results.Encuentra m\u00e1s de nuestra cobertura en los resultados de b\u00fasqueda. Add The New York Times on GoogleAgrega The New York Times en Google After four months of talking tough about inflation, Kevin M. Warsh finally followed through.On Wednesday, the chairman of the Federal Reserve announced with his colleagues that the central bank had raised interest rates by a quarter of a percentage point to a new range of 3.75 percent to 4 percent.The move was widely expected, with financial markets ascribing over 90 percent odds to an increase ahead of the gathering. The question now is what comes next.Mr. Warsh, in an abridged news conference, sought to keep the Fed\u2019s options open. He underscored his aversion to providing guidance about what the future path of policy might be and said plainly that he did not want to \u201cprejudge any future decisions we make.\u201dBut in parsing through Mr. Warsh\u2019s comments on Wednesday, and a new set of economic projections from officials that accompanied the rate decision, it was clear that the Fed was not done raising rates.AdvertisementSKIP ADVERTISEMENTThe most direct signal came from the updated \u201cdot plot,\u201d which aggregates on a quarterly basis what officials think will happen to borrowing costs over the coming years.Fed Officials\u2019 Expectations for Rates\n \n \n \nA chart showing what the 19 Fed officials think the Federal Funds rate should be at the end of this year and next, which range from about three to five percent.\nLatest projections\n6\n%\n5\n4\n3\nEach dot represents what one Fed official thinks the midpoint of the target rate range should be at the end of that year.\n2\n1\n\u201926\n\u201927\nLatest projections\n6\n%\n5\n4\n3\nEach dot represents what one Fed official thinks the midpoint of the target rate range should be at the end of that year.\n2\n1\n\u201926\n\u201927\n \n Note: The actual target rate shows the midpoint of the federal funds target rate range.Source: Federal ReserveBy Jacqueline GuIt showed that 16 of the 18 policymakers who submitted projections expected at least one more quarter-point move by the end of the year. That would push rates to a range of 4 percent to 4.25 percent. Most wanted rates to stay at or above that level throughout 2027. They also raised their estimates for rates for 2028 and beyond compared to three months ago.Mr. Warsh, as in June, did not submit projections, in keeping with his opposition to the dot plot as a communications tool. But he appeared aligned with the message that the Fed\u2019s work was not complete.Mr. Warsh struck an upbeat tone about economic growth and the labor market, emphasizing that the Fed\u2019s focus had to be on inflation at this juncture. He emphasized the unanimity around the rate decision, which he said showed \u201cwe\u2019re serious about this.\u201d And he made clear that he was unsatisfied with the recent trend in the data that showed lackluster progress toward the 2 percent inflation goal.AdvertisementSKIP ADVERTISEMENTThe comment that garnered the most attention, however, was his description of Wednesday\u2019s move as the Fed having \u201cremoved a dose of accommodation so that financial and credit conditions would be more consistent with our ultimate objectives.\u201dThat gave the impression that Mr. Warsh did not believe the Fed\u2019s policy settings were weighing meaningfully on the economy and instead were bolstering it, conveying a more hawkish message than expected.He was later asked how this related to his views of the \u201cneutral\u201d policy setting that neither spurs growth nor subdues it \u2014 a concept that is often used by Fed officials when describing their rate outlooks. Mr. Warsh suggested that this \u201cacademic\u201d framing had no bearing on Wednesday\u2019s decision.Without a sense of how Mr. Warsh saw the policy rate relative to an estimate of the neutral rate, economists and investors were left guessing how many more increases the chairman believed were necessary to quell inflation.Sign up for the On Politics newsletter. It's a pivotal moment for American politics. Join us for 2026 and beyond. Get it sent to your inbox.In the absence of a specific steer, the consensus view is that the Fed will raise rates a couple of more times through the early part of 2027. Patrick Harker, who served as president of the Federal Reserve Bank of Philadelphia for a decade-long tenure that ended in 2025, said he expected the Fed to reverse cuts that it delivered late last year to guard against a weakening labor market. That would suggest two additional moves, for a total 0.75 percentage point increase in rates.AdvertisementSKIP ADVERTISEMENTHe expects the Fed to skip raising rates at the central bank\u2019s next meeting in late October, just days before the midterms, not only because of the \u201coptics\u201d of taking action just before an important election, but also because there is \u201cno rush,\u201d having just moved this month.\u201cI don\u2019t think they\u2019re looking at a long cycle of increasing rates,\u201d said Mr. Harker. \u201cI don\u2019t think they were mildly restrictive and this is moving them there.\u201dRaising rates just before the midterms would further anger President Trump, who criticized the Fed for taking action on Wednesday. Speaking to reporters, he reiterated his belief that the United States should pay the \u201clowest interest rate anywhere in the world because we have the strongest credit.\u201dMr. Trump, who picked Mr. Warsh for the top job, did not directly blame the new chairman, in a break from his past practice of admonishing Jerome H. Powell, the former head of the central bank. Instead, he directed his anger at the six other members of the Board of Governors, two of whom were appointed by Mr. Trump.The president, late on Wednesday, said he told Mr. Warsh that he \u201cmight as well vote with the board because it\u2019s just not going to matter.\u201d He added: \u201cThe board is very hostile. They\u2019re very political. They\u2019re doing the wrong thing. They\u2019re a bunch of politicians.\u201dAdvertisementSKIP ADVERTISEMENTThe timing of future adjustments depends in large part on the incoming data. Signs that inflation was continuing to stall out, or worse, deteriorate further, would keep pressure on the Fed to deliver successive increases regardless of the electoral calendar.The problem, said Seth Carpenter, a former Fed economist who is now at Morgan Stanley, is that \u201cthere is very clear tension within the committee in terms of how to think about a single data point.\u201dMr. Warsh on Wednesday emphasized that he was most focused on trends in inflation rather than specific data points, which he described as \u201cnoisy.\u201d\u201cData point dependence is a dangerous preoccupation,\u201d he said. \u201cIt\u2019s not something that concerns me. Markets over time will come to understand how this Fed makes its decisions, what\u2019s relevant and not.\u201dBut other officials at the Fed, and financial markets more broadly, appeared to be ascribing a great deal of importance to incoming data, suggesting there were different thresholds for additional action for different people.AdvertisementSKIP ADVERTISEMENT\u201cIt\u2019s going to be very tricky,\u201d said Mr. Carpenter, regarding what would and would not constitute a catalyst for another increase.The risk is a breakdown in the unanimity seen on Wednesday, a fissure that could grow more pronounced if there started to be a trade-off between taming inflation and maintaining a healthy labor market, said Derek Tang, an economist at the research group LHMeyer.\u201cWarsh is willing to hike right now and do this for inflation because there\u2019s a low cost to doing so,\u201d Mr. Tang said. \u201cWhat\u2019s not answered is: What if the cost of doing so is higher?\u201dRight now, that tension does not exist. The unemployment rate is low, consumers are still spending and growth has stayed solid. But Daleep Singh, who formerly worked at the New York Fed and the Treasury Department, warned that achieving Mr. Warsh\u2019s inflation pledge might require much more substantive tightening that could imperil that.As of now, Mr. Singh forecasts the Fed delivering a total of three quarter-point increases before pausing, delivered in October and December. It is far from clear if that will be enough for a Fed that is confronting \u201coverlapping and compounding supply side shocks,\u201d he said, and an environment in which the drivers of growth, such as artificial intelligence, are not as sensitive to higher rates as other sectors.\u201cIf we\u2019re wrong, it\u2019s not that they\u2019re going to hike less than 75 basis points; it\u2019s that they may have to hike more,\u201d said Mr. Singh. \u201cThe market is going to have to assign at least some probability to the scenario in which this is an open-ended rate hiking campaign that involves more significant pain in terms of economic growth.\u201dAdvertisementSKIP ADVERTISEMENT",
    "published_at": "2026-09-17T09:05:11+00:00",
    "author_name": "Colby Smith",
    "site_name": "The New York Times",
    "section": "business\/economy",
    "publisher": "The New York Times Company",
    "ai_headline": "The Fed, After Raising Rates, Grapples With What Comes Next",
    "ai_simplified_title": "Fed Raises Rates, Warsh Signals More Hikes Possible Amid Inflation Concerns",
    "ai_excerpt": "The Federal Reserve, led by Chairman Kevin M. Warsh, raised interest rates by a quarter of a percentage point, bringing the target range to 3.75 percent to 4 percent. Warsh indicated that further rate increases might be necessary to combat inflation, despite political pressure and economic uncertainties.",
    "ai_subject_tags": [
        "Federal Reserve",
        "Interest Rates",
        "Inflation",
        "US Economy",
        "Monetary Policy",
        "Kevin M. Warsh",
        "Economic Projections"
    ],
    "ai_context_type": "News",
    "ai_context_details": {
        "tone": "informative",
        "perspective": "neutral",
        "audience": "general",
        "credibility_indicators": [
            "expert_quotes",
            "data_cited"
        ]
    },
    "ai_source_vector": null,
    "ai_confidence_score": 0.9999999999999999,
    "ai_extraction_metadata": {
        "extracted_at": "2026-09-18T03:07:55.964653Z",
        "ai_model": "gemini-2.5-flash",
        "extraction_method": "automated",
        "content_length": 9408,
        "metadata_prompt_body_chars": 9408,
        "metadata_prompt_truncated": false,
        "url": "https:\/\/nytimes.com\/2026\/09\/17\/business\/economy\/fed-interest-rates-warsh.html",
        "existing_metadata": {
            "author_name": null,
            "published_at": null,
            "domain_name": "nytimes.com",
            "site_name": null,
            "section": null,
            "publisher": null
        },
        "openai_refusal_gemini_fallback": false
    }
}

{
    "extracted_at": "2026-09-18T03:07:55.964653Z",
    "ai_model": "gemini-2.5-flash",
    "extraction_method": "automated",
    "content_length": 9408,
    "metadata_prompt_body_chars": 9408,
    "metadata_prompt_truncated": false,
    "url": "https:\/\/nytimes.com\/2026\/09\/17\/business\/economy\/fed-interest-rates-warsh.html",
    "existing_metadata": {
        "author_name": null,
        "published_at": null,
        "domain_name": "nytimes.com",
        "site_name": null,
        "section": null,
        "publisher": null
    },
    "openai_refusal_gemini_fallback": false
}