Morgan Stanley: Nothing Will Change Materially Under Chairman Warsh, Especially In The Near Term

By Seth Carpenter, Morgan Stanley chief economist

Jerome Powell’s term as Chair is drawing to a close. Last week’s FOMC meeting brought no change in policy, but the two dissents in favor of a cut demonstrate the division within the FOMC. Reports indicate that Kevin Warsh will be the nominee for the Chair to replace Powell. A natural question is what the Fed’s reaction function will be in the future.