No Forward-Looking Guidance Needed: 5 Words From Fed Chair Kevin Warsh Strongly Signal What's Next for Interest Rates

On May 22, Kevin Warsh was sworn in as only the 17th Fed chair since the central bank's creation in December 1913. During his swearing-in speech, he vowed to lead a reform-oriented Fed, and he hasn't wavered on this promise.

Beginning with the June Federal Open Market Committee (FOMC) meeting, Warsh did away with forward-looking guidance. Although Wall Street's major stock indexes, the Dow Jones Industrial Average (DJINDICES:^DJI), S&P 500 (SNPINDEX:^GSPC), and Nasdaq Composite (NASDAQINDEX:^IXIC), haven't always been thrilled with the idea of less transparency from the central bank, sometimes forward-looking guidance isn't needed -- especially when Warsh is dropping unmistakable clues as to what comes next for interest rates.

Fed Chair Warsh just offered a big clue about interest rates. Image source: Official Federal Reserve Photo.

Continue reading