The Federal Reserve held rates unchanged at Warsh's inaugural meeting, but the internal split is the real story: the dot plot now shows a faction projecting rate increases rather than cuts, a meaningful hawkish shift from prior guidance. Officials cited bracing for higher inflation — likely reflecting tariff pass-through and sticky services — as the reason for the more aggressive posture on the right tail of the distribution.

The setup this creates is a repricing of the 'Fed put' that has underpinned equity valuations: if the next move is a hike rather than a cut, duration-sensitive assets (long-dated Treasuries, high-multiple growth equities, rate-sensitive sectors like utilities and REITs) face a structural headwind. The key watch items are the next CPI print, any Warsh press conference signals, and whether the 2-year yield breaks above its recent range — that would confirm the market is internalizing the hawkish skew.