Federal Reserve Chair Kevin Warsh’s first public testimony before the Senate Banking Committee has drawn positive reactions from key lawmakers, though the broader market narrative remains anchored in inflation concerns.
Mike Rounds, R-S.D., a member of the committee, told CNBC’s “Squawk Box” that Warsh struck the right tone during his appearance this week.
The comment offers a brief moment of political calm for the new central bank leader, who has faced intense scrutiny since taking the helm.
Despite the diplomatic success on Capitol Hill, financial markets have not yet priced in a dovish pivot.
US Treasury yields remain elevated, reflecting persistent worries that Middle East tensions could drive oil prices higher and reignite inflation.
The 10-year yield has stayed near multi-month highs, while the 2-year yield continues to reflect the market’s expectation that the Fed may need to keep rates restrictive for longer than previously anticipated.