Kobeissi Letter says markets overestimate September Fed rate hike odds

The post asserts that President Trump set rate cuts as a requirement for choosing the next Federal Reserve Chair. Under this premise, a Chair Kevin Warsh would be unlikely to begin with a rate increase. It states that markets are overestimating the probability of a September rate hike.

Key points

- Condition set by President Trump: rate cuts from the next Fed Chair
- Question raised: whether Chair Warsh would raise rates in his first move
- Assessment: markets assign too high a probability to a September hike