Forex
Hawkish Sentiment Gains Ground Ahead of Key US Fed Meeting
The US Federal Reserve's upcoming meeting has seen a shift in sentiment towards hawkish policy, according to market commentary.
Kish Pathak and Erik Weisman of MFS Investment Management believe that Fed Chair Kevin Warsh's decision to hold a press conference after the meeting suggests it will be consequential.
Warsh has leaned into hawkish sentiment by underplaying the short-term impacts of AI adoption on inflation and dismissing the positive June inflation print as 'mission-accomplished'.
The recent resurfaced tensions in the Middle East and renewed oil shock risk have tipped the needle towards possible policy tightening to combat further volatility.