Bond Rout Sends Warning to Warsh That Tough Talk Is Not E…

The bond market's recent reaction indicates skepticism regarding Federal Reserve Chairman Kevin Warsh's commitment to controlling inflation. Following the Fed's decision to keep interest rates unchanged for the seventh consecutive month, investors sold off 30-year Treasury bonds, resulting in a yield increase to approximately 5.23%, a level not seen in 19 years. This move also led to rising inflation expectations, a declining dollar, and falling stock prices, as investors perceive that Warsh may be postponing tougher measures.

Markets

FacebookXLinkedIn

EmailLink

Gift

Expand

Kevin Warsh speaks during a news conference at Federal Reserve Headquarters in Washington on July 29.

Photographer: Win McNamee/Getty Images

FacebookXLinkedIn

EmailLink

GiftGift this article

Confidential tip?\ Send a tip to our reporters

Site feedback:\ Take our SurveyNew Window

FacebookXLinkedIn

EmailLink

Gift

By Michael MacKenzie, Ye Xie, and Greg Ritchie

July 29, 2026 at 10:31 PM UTC

Updated on July 29, 2026 at 11:50 PM UTC

BookmarkSave

The message from the bond market was clear: For all of Federal Reserve Chairman Kevin Warsh’s tough talk about taming inflation, he’s in no rush to use the power of the central bank to do it.

After the Fed kept interest rates unchanged for a seventh straight month, investors dumped 30-year Treasury bonds, sending the yield shooting up as much as 14 basis points to nearly 5.23%, a 19-year high. Market measures of inflation expectations rose, the dollar slid, and even stocks tumbled as investors wagered Warsh was only delaying the inevitable.

Read Original at Bloomberg.com →

Bond Rout Sends Warning to Warsh That Tough Talk Is Not Enough