Warsh Sparks Rate Hike Bets as Oil Surges Amid US-Iran Conflict

Hawkish comments from Federal Reserve boss Kevin Warsh have sent investor bets on a U.S. interest rate hike surging, as oil prices spiked after a fresh flare-up in the U.S.-Iran war.

The Iran conflict has contributed to stubbornly high inflation, largely driven by elevated energy costs, putting pressure on the Fed to act. However, Warsh's speech at the Jackson Hole symposium of central bankers and economists left traders with few doubts that he was ready to increase borrowing costs.

'We must be confident that underlying inflation is moving to our objective, clearly and at sufficient speed. Otherwise, we have work to do,' Warsh said in his highly anticipated speech last week.