May jobs rebound puts Fed chair Kevin Warsh under pressure
The US job market just had a big rebound, and it's already giving new Federal Reserve chair Kevin Warsh some tough choices.
The latest May jobs report came in strong, which has everyone talking about possible interest rate hikes soon, maybe as early as July if prices keep rising.
Warsh is only two weeks into the job, but he's already feeling the heat.
Wall Street shifts toward rate hikes
Wall Street quickly changed its tune: instead of expecting rate cuts this year, some analysts now think hikes could start by December.
The Nasdaq dropped over 4%, and bond yields jumped.
Meanwhile, gas prices have shot up nearly 50% since the start of the year due to global tensions, adding to inflation fears.
President Trump isn't a fan of raising rates and says growth doesn't always mean higher prices—a view his adviser Kevin Hassett echoed.
With a key Fed meeting coming up mid-June, Warsh has to juggle fighting inflation with keeping borrowing costs low, definitely not an easy start!