Institutional Outlook: Walsh's Debut Summary: Policy Stance Awaits Clarification, Both Hawkish and Dovish Views Carry Risks

According to Mars Finance, Kevin Warsh will chair the FOMC meeting for the first time as Federal Reserve Chairman in the early hours of June 17th. While the market has little suspense regarding interest rates themselves, significant uncertainty remains regarding his policy stance and the basis for his decisions. The following is a summary of institutional forecasts for the event: UBS: There is still insufficient confidence in Warsh's policy stance, and his monetary policy response remains uncertain. Whether Warsh is hawkish or dovish, both could bring market pricing risks. ANZ: Warsh has demonstrated a strong willingness to reform, and his reform ideas are expected to be revealed at the press conference. More detailed information may be clarified in his opening speech at the Jackson Hole symposium in August. Bank of America: Warsh is expected to be dovish in his press conference. We believe he will say that the Iranian conflict does not affect underlying inflation (it only has a one-off impact on price levels), therefore the Fed should "ignore" it, especially after recent news that the conflict has been resolved. Capital Economics: May ask about his views on interest rates. The market risk is that Warsh's remarks may be more hawkish than expected—either due to a communication mishap or simply because his current stance is not as dovish as it was when he was vying for President Trump's nomination. Yale University: If Warsh relies too heavily on soft logic such as the "AI deflation theory" while ignoring hard data, the Fed may repeat the mistake of the "temporary inflation theory." Nordea Bank: Warsh is expected to lean towards a more neutral or even slightly hawkish view to enhance his credibility. Any changes in his communication will be indicative rather than immediately implemented. BNY Mellon: Warsh has consistently been critical of forward guidance and may use this press conference (or limit the number of press conferences) to indicate how communication policy will change during his term. MFS Investment Management: Given Warsh's views on technological productivity, he may make dovish remarks. However, this is unlikely, as such remarks at this time would damage his hawkish image. (Jinshi)