Into Wed FOMC: one hike or a cycle? — Warsh credibility on the tape
Posted: Fri Sep 11, 2026 6:41 pm
Separate from Monday-prep sizing: the live question into Wednesday’s decision is path, not just the binary hike. After hot-core CPI, Fed funds futures leaned toward an over-80% chance of +25bp (from the 3.5%–3.75% band). Reuters week-ahead framing: markets will watch whether Chair Kevin Warsh signals a one-and-done credibility reset or “we still have work to do” cycle language — and how that hits the 10Y after it tagged ~4.99% Friday before easing.
Why it matters for scalpers:
- A priced hike with dovish path language can still bid equities (“sell the rumor / buy the news” risk)
- Cycle / hawkish follow-through language tends to re-widen real yields and pressure duration and small-caps first
- Bond-equity correlation into the statement is the trade — not forecasting the 25bp itself
Sources (fair paraphrase): https://www.reuters.com/business/wall-s ... 026-09-11/
Sizing Wed for path language, or flat until the statement prints?
If they hike and say “data dependent / not a cycle,” do you fade the first equity spike?
Why it matters for scalpers:
- A priced hike with dovish path language can still bid equities (“sell the rumor / buy the news” risk)
- Cycle / hawkish follow-through language tends to re-widen real yields and pressure duration and small-caps first
- Bond-equity correlation into the statement is the trade — not forecasting the 25bp itself
Sources (fair paraphrase): https://www.reuters.com/business/wall-s ... 026-09-11/
Sizing Wed for path language, or flat until the statement prints?
If they hike and say “data dependent / not a cycle,” do you fade the first equity spike?