Investor Paul Tudor Jones said Thursday that incoming Federal Reserve Chairman Kevin Warsh is not considering cutting interest rates and may instead want to consider raising them.
“Do you think he’s going to cut rates? There’s no chance of that,” Jones said in a wide-ranging interview on CNBC’s “Squawk Box.”
Warsh has made no secret of his belief that central banks should consider lowering interest rates. The Fed’s benchmark overnight rate currently ranges from 3.5% to 3.75%, where it has been since December.
Warsh sees a path to relief, but he faces the most dissenting Federal Open Market Committee meeting in nearly 34 years. Most of the disagreement came from regional presidents who objected to the wording of the post-conference statement, which was interpreted as a nod to the possibility of further cuts after the trilateral cut in late 2025.
Jones said there is a need to justify the hike.
“Well, I’m thinking of growing one,” he said. “I’d like to see the data. But I mean, you definitely think about that. And I think he’s going to be locked up before the election.”
Policymakers face an environment where the Iran war and President Donald Trump’s tariffs have pushed inflation well above the Fed’s 2% target, while the labor market appears stable.
Futures traders are pricing in the Fed remaining on hold for the rest of the year, with the chances of a rate cut or rate hike being slim to equal, according to CME Group FedWatch indicators.
