Kevin Warsh cuts rates at first Fed meeting?

Kevin Warsh was picked by Trump explicitly to be more accommodative than Jerome Powell, and Trump has publicly called for a "special meeting" to cut rates immediately. Despite that political pressure, prediction markets have priced a cut at Warsh's first FOMC meeting — June 16–17 — as a near-impossibility. The hold dominates the distribution overwhelmingly, with all cut scenarios combined accounting for a fraction of the remaining probability. Wall Street has essentially written off the prospect of first-meeting easing entirely. The constraint isn't political will — it's the data environment Warsh is walking into. Inflation is still running above target, amplified by oil price pressure from the Iran conflict. Long yields have risen in response to that inflationary backdrop. FOMC minutes from recent meetings showed near-unanimous agreement to hold, with dissents running in both directions. Cutting 50 basis points into that environment, at a debut meeting, would not read as dovish leadership — it would read as capitulation to political pressure, and the bond market would price it accordingly with a yield spike that undermines whatever stimulus effect the cut was supposed to deliver. That credibility calculus is the real story here. Warsh is a former Fed governor who has written extensively about central bank independence and the dangers of politicized monetary policy. Arriving at his first meeting and immediately delivering the cut Trump demanded would permanently define his tenure as politically captured — a label that would constrain every subsequent decision. The more likely path is a hold at June, a statement that signals openness to easing if the data cooperates, and a cut delivered later in 2026 that Warsh can frame as data-driven rather than presidential. Markets are pricing that sequencing correctly.