Warsh Floats Radical Overhaul of Fed Meeting Schedule

Fed Chair Kevin Warsh is considering reducing the number of interest rate-setting meetings from eight to four, according to reports. This would be a significant change in how the central bank operates, as it has been meeting eight times a year since 1981.

Warsh raised this idea during last week's Federal Open Market Committee meeting and asked whether there would be benefits to meeting less frequently. The proposal follows his broader push to reshape how the Fed conducts itself.

Some economists argue that fewer meetings would encourage policymakers to focus more on economic data between meetings, rather than relying on signals from the Fed. However, others warn that it could lead to more volatility in markets as investors search for clues about what the Fed may do next.

Russell Rhoads, a clinical associate professor of financial management at Indiana University's Kelley School of Business, said 'cutting the number of meetings is going in the wrong direction' and that increased transparency has diminished volatility around Fed meetings.