Hoenig: Rates Should Not Be Lowered

Former Kansas City Fed President Thomas Hoenig appeared on a news segment discussing the upcoming Senate Banking Committee hearing for Fed Chair nominee Kevin Warsh. The hearing, scheduled for Tuesday, comes amidst a contentious Fed transition, with President Trump's term ending in less than a month. Hoenig, now a distinguished senior fellow at George Mason University's Mercatus Center, expressed uncertainty about how the transition would unfold, acknowledging the significant turmoil surrounding it. He anticipated that Warsh would face challenging questions during his confirmation hearing, particularly regarding his views on a potential new Fed-Treasury accord and inflation outlook. Hoenig also noted that the ongoing drama involving former Fed Chair Jerome Powell's tenure could further complicate Warsh's confirmation process. Despite the uncertainty, Hoenig believed that the situation would eventually be resolved, though it might not happen as quickly or smoothly as desired, potentially causing further market turmoil if left unaddressed.