U.S. stocks finished Friday lower after Federal Reserve Chair Kevin Warsh warned that inflation remains too high and suggested interest rate hikes could be needed in the coming months. The Dow Jones Industrial Average (DJIA) slipped 0.02% to 53,559.99, the S&P 500 (SPX) fell 0.25% to 7,711.76, and the Nasdaq (NDX) dropped 0.70% to 29,433.43. Despite Friday’s weakness, all three major indexes still finished the week modestly higher.
The 10-year U.S. Treasury yield ended near 4.73%. Gold (CM:XAUUSD) rose 0.91% to $4,505.60, while oil (CM:CL) fell 1.33% to $83.43. Bitcoin (BTC-USD) slipped 1.1% to $77,472.47, while the VIX edged 0.34% lower to 14.43.
Fed Chair Warsh Puts Rate Hikes Back on the Table
Interest rates returned to the center of the market conversation on Friday after Fed Chair Kevin Warsh used his first Jackson Hole speech as chairman to make clear that the inflation fight is not over.
Warsh said recent inflation data have improved somewhat but have not convinced him that underlying price pressures are falling quickly enough. He suggested the Fed could need to raise interest rates in the coming months if inflation does not make more progress toward the central bank’s 2% target.
