Citadel is telling its clients something Wall Street doesn’t want to hear: the new Fed chair means business on inflation, and most investors aren’t priced for it.
Citadel strategist Nohshad Shah cautioned that markets are underestimating Kevin Warsh’s commitment to dragging inflation back to the 2% target. With the consumer price index hitting 4.1% in May, that’s not a small gap to close.
Warsh’s hawkish debut
Kevin Warsh was sworn in as Fed Chairman on May 22, 2026. At the FOMC meeting on June 16-17, the committee held the federal funds rate steady at 3.50-3.75%, but Warsh’s accompanying language was unmistakably hawkish.
He framed high prices as a direct burden on American households. Nine FOMC members signaled openness to rate hikes in future communications, reinforcing the impression that the committee is ready to move if conditions warrant it.
