Bond Selloff Intensifies Amid Iran Conflict and Powell's Final Press Conference

Key Facts

The Federal Reserve held interest rates steady in Jerome Powell's final meeting as chair, marked by internal dissent from Neel Kashkari. Kashkari revealed that his opposition was driven by concerns over inflationary pressures resulting from the conflict in Iran, aligning with Powell's warning that inflation has not yet peaked. While Kevin Warsh has cleared a Senate Banking Committee vote to lead the June meeting, fund managers warn of a major pivot in monetary policy amid deep internal divisions. Global bond markets continue to face an intensifying selloff as investors navigate supply shocks and this pivotal leadership transition. Market volatility remains elevated as traders brace for the impact of surging energy costs and a potentially more hawkish Fed leadership under Warsh.

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