Rebecca Patterson Talks Warsh, Fed Rate Decision Preview

Summary

Podcast Summary: Bloomberg Talks – "Rebecca Patterson Talks Warsh, FOMC Preview" (June 15, 2026)

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Episode Overview

In this episode of Bloomberg Talks, the panel explores the upcoming Federal Open Market Committee (FOMC) meeting in light of Kevin Warsh's leadership, Federal Reserve policy challenges, the impact of geopolitical tensions with Iran, dollar outlooks, and market reactions. The episode also weaves in lighter moments, including sports talk around the Knicks' recent championship and New York's resurgence. With economic and financial insight from Rebecca Patterson (Council on Foreign Relations), Paul, Annmarie Horden, and the host, the episode provides topical analysis on monetary policy and global markets.

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Key Discussion Points & Insights

1. FOMC Preview & Kevin Warsh’s Challenge

• Fed's Main Priority:

  • Kevin Warsh’s main goal is reinforcing the Fed’s credibility and maintaining political neutrality amidst White House pressure to cut rates.
  • “Priority one, two and three this week is reinforce the Fed's credibility. You don't want any questions about any political bias. So that's goal number one for Kevin Warsh this week.”
    — Paul (00:52)

• Press Conference & Communication Style:

  • Warsh may hold a press conference, but it’s not certain; if so, it’ll be to outline his priorities: reviewing economic models, improving processes, and reassessing the Fed’s communications strategy.
  • He has previously advocated for “less communication, think more, speak less.”
    — Paul & Host (01:30)

• Rate Decision Outlook:

  • Despite pressure from the President and White House to lower rates, economic data isn’t supportive of a cut; core PCE for May tracking at around 3.3% y/y.
  • Even with potential easing of tensions in the Strait of Hormuz and lower oil prices, inflation and a strong economy create a case for a possible rate hike.
  • “If that's the number that comes in or something like that, there's no way they can cut rates anytime soon.”
    — Paul (01:55)

2. War with Iran & Market Dynamics

• Impact on the Dollar:

  • The dollar strengthened against most major currencies due to higher rate expectations and commodity price-driven inflation pressures.
  • The only exceptions were the Norwegian crown and Australian dollar—both commodity-linked.
  • “The dollar...was stronger against everything else, primarily on rate expectations, higher interest rates following higher energy prices and broader inflation pressures.”
    — Paul (02:56)

• Global Central Bank Moves:

  • The episode notes upcoming possible policy moves from the Bank of Japan and ECB, implying currency moves will be global, not just USD-driven.

• Peace Talks & Market Optimism:

  • Speculation about peace with Iran leads to market optimism (lower oil, higher stocks), but the hosts are skeptical about durability without confirmed details.
  • “We have some tweets and some headlines suggesting that we have a step forward, forward towards peace. But...it's not clear yet if it sticks.”
    — Paul (04:16)
  • "If we have peace...Iran desperately needs money. It needs to rebuild. The US does not want oil at a 4 handle or 30 year yields at a 5 handle going into midterms.”
    — Paul (05:02)

3. Commodities Commentary

• Gold Market:
  • Gold surged in early 2026 due to speculation and central bank reserves activity.
  • Russia and Turkey were significant sellers, but overall, central banks are still net buyers.
  • “Central banks in general are continuing to buy.”
    — Paul (05:54)

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Notable Quotes

• Fed Independence:
  “Priority one, two and three this week is reinforce the Fed's credibility. You don't want any questions about any political bias.”
  — Paul (00:52)

• Macro Outlook:
  “If that's the number that comes in or something like that, there's no way they can cut rates anytime soon.”
  — Paul (01:55)

• Dollar Strength:
  “The dollar...was stronger against everything else, primarily on rate expectations, higher interest rates following higher energy prices and broader inflation pressures.”
  — Paul (02:56)

• Geopolitical Uncertainty:
  “But the deal isn't supposed to be signed till Friday. And even then it's not clear yet if it sticks.”
  — Paul (04:16)

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Sports & New York City Sidebar

Knicks’ Historic Win and NYC's Resilience

• Knicks Championship Vibes:

  • In-studio reaction to the Knicks clinching a championship after 53 years, with emotional scenes among fans.
  • “There was literally, literally tears from New Yorkers and their faces. Grown men just absolutely crying.”
    — Annmarie Horden (07:29)

• The Energy in San Antonio:

  • “San Antonio was the sixth borough on Saturday night...had to be 50%, maybe 75% New York Knick fans.”
    — Annmarie Horden (06:48)

• Reflections on NYC Comeback:

  • Despite post-COVID pessimism, indicators like packed offices and rising real estate hint at a strong New York revival.
  • “New York's back. People are working five days a week in the office. Real estate prices are coming back...last week if you tried to get around the city in a cab or even on the subway, it was packed.”
    — Paul (08:47)

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Timestamps for Key Segments

• 00:52 – 02:44: FOMC preview, Warsh’s priorities, and interest rate outlook
• 02:44 – 03:52: Dollar dynamics, global currency moves, and inflation
• 03:52 – 05:24: War with Iran impact, peace speculation, and market responses
• 05:24 – 05:54: Gold market moves and central bank actions
• 06:23 – 07:58: Knicks’ championship win—anecdotes and NYC reflections
• 08:47 – 09:09: New York City’s resilience and signs of urban revival

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Memorable Moments

• Knicks win inspires tears and city pride: “There was literally, literally tears from New Yorkers and their faces. Grown men just absolutely crying.” (07:29)
• Real-time finance humor: Paul jokes about being a Celtics fan, but "we're all Knick fans today." (08:15)
• Macro caution: “I wouldn't assume anything right now,” on market optimism following war headlines. (04:16)

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Conclusion

This episode delivers an incisive analysis of central bank policy and market reactions in the midst of macroeconomic and geopolitical turbulence. With a balance of high-level finance discussion and human interest (sports and urban revival), it’s both informative and lively—offering context for investors, market watchers, and the broader business audience.

Transcript

[Announcer]

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[Paul]

Bloomberg Audio Studios Podcasts, Radio news news flow here.

[Host]

With the President landing for the G7 meeting, we're going to go to Tyler Kendall, but let's dash to Rebecca Pat right now to be kind Senior Fellow at the Council on Foreign Relations. Her work at Bridgewater Bessemer JP Morgan over the years. Thrilled she could join. I guess I got to do the Fed meeting. To me, it could be dramatic. If he's going to change things, he doesn't want to dawdle around, does he?

[Paul]

I mean, I think priority one, two and three this week is reinforce the Fed's credibility. You don't want any questions about any political bias. So that's, that's goal number one for Kevin Warsh this week, I think, which he should be able to execute beautifully. I think beyond that, if he does a press conference, I expect he will, but it's not a given. If he does a press conference, then that'll be his opportunity to lay out the priorities. What is he going to focus on? First, I would imagine he wants to review all the economic models, the processes. He's going to review communication. He's already been very vocal about having less communication, think more, speak less.

[Host]

It has been for years.

[Paul]

Yes.

[Host]

A new thing.

[Paul]

The balance sheet will wait.

[Announcer]

Yeah. So, Rebecca, obviously he's got some level of pressure from the President, from the White House to lower rates, but the data is not there. He's got a committee he has to deal with.

[Paul]

Yep.

[Announcer]

I would think the messaging this week is as much for the rest of us, that is the market, maybe even more so for the President.

[Paul]

Yeah. I mean, he's got a difficult needle to thread here. Right. Keep the President on his side ideally, but build credibility and trust with his colleagues at the fomc. I mean, and to your point on the data, I mean, Right now core PCE for May is tracking at around 3.3% year on year. If that's the number that comes in or something like that, there's no way they can cut rates anytime soon. And even if the Strait of the Hormuz. Strait of Hormuz does open soon, which we all hope it does, and oil prices retreat further, you still have a strong economy now, probably stronger. You have inflation coming through the channel as well as other channels. And so it seems like the market pricing and the possibility of a hike makes a lot more sense. So that is going to be a challenge for Chairman Warsh for sure.

[Announcer]

But the US Dollar here, we kind of came into the year, I guess the consensus on the street was for a weaker dollar. And then the war with Iran starts and we had that flight to quality like we typically see now.

[Annmarie Horden]

What?

[Paul]

Well, the dollar, until the news over the weekend, was down or, sorry, was down against only two major currencies, the Norwegian crown and the Australian dollar, both big commodity exporters. It was stronger against everything else, primarily on rate expectations, higher interest rates following higher energy prices and broader inflation pressures. Now that that is off the table, you have seen yields, as you guys just mentioned, down a little bit. You are seeing the dollar down a little bit today. And the question again, it goes back to the Fed. Do we have a hawkish bias in the press conference this week or not? I think the rate expectations will continue to be pretty important for the dollar going ahead. And again, it's not just the U.S. right. Two sides to every currency trade. We expect a Bank of Japan hike this week. The ecb, the European Central bank just raised rates. So it's not clear how much stronger the dollar gets out of Florida.

[Host]

In Johns Hopkins, I mean, there was this. If you end a war, even as Kaplan says, a middle war, the idea is you get a disinflationary tendency. So not Rebecca Patterson now at cfr. Yeah, but if you're on Wall street right now in what's clearly a boom investment banking environment, do you just assume disinflation?

[Paul]

I wouldn't assume anything right now. Look, we have, we have some tweets and some headlines suggesting that we have a step forward, forward towards peace. But the deal isn't supposed to be signed till Friday. And even then it's not clear yet if it sticks. It's not clear what the terms are going to be. I mean, Iran wants and needs funding. I think they could still pressure to have some sort of fee, service fee to go through the straight. Not a toll, a service fee.

[Host]

Right. And Paul, this is really Rick Wilson just out on Twitter with just a scathing quick note like, where are the details? Yeah, when do we get the details? I don't have an answer.

[Paul]

And we might not. First for 60 days. Right.

[Host]

The markets will flip right around if we do that.

[Paul]

Well, they may do that. Right. And that's the point. Oil has come down, stocks are up. Does it last? Do you want to chase it here? I mean, if the, if we have peace and it's Certainly in both sides interest to have peace. Iran desperately needs money. It needs to rebuild the the US does not want oil at a 4 handle or 30 year yields at a 5 handle going into midterms.

[Announcer]

Gold seems like it just a cup of coffee goes Tom and said we were at $5,000 an ounce. We've seen a pullback here, 4,300 here.

[Paul]

Yeah. I mean you had a lot of speculative money going to gold at the beginning of the year. We had a little bit of a parabolic move. So that was part of it. But the other part of it is we did have two big central banks, Russia and Turkey. Selling Russia sold for four months in a row. Turkey was the biggest seller of gold in March. But those are the outliers. Central banks in general are continuing to buy.

[Host]

Bloomberg surveillance across this nation. And for San Antonio, 3am at a diner. Anne Marie Horton tried to get over the hangover. Joining us now with Rebecca Patterson in studio is Annmarie Horden who was. Yeah. Doing a seminar in Houston. Can you get me tickets to San Antonio? I'll take an Uber. How did you get from Houston to San Antonio?

[Annmarie Horden]

Our friend drove me.

[Host]

Your friend drove?

[Annmarie Horden]

Yeah. So a friend saw that I was in Houston also saw I was at game three with the president and said, I'm going to game five. Why don't you come? And I made a game time, game time decision Saturday morning. And I was like, you know what? Like, I'm so close.

[Host]

Were you sitting with Prince Harry?

[Annmarie Horden]

I was not sitting with Prince Harry. Oh yeah, you texted me. I saw him. I saw Spike Lee. I was sitting more by Patrick Ewing, which was pretty amazing.

[Paul]

But did he block your view?

[Annmarie Horden]

He did not block my view. He was actually behind me. So I will say San Antonio was the sixth borough on Saturday night. It was really had to be 50%, maybe 75% New York Knick fans. And the first quarter or two, obviously we were behind, but we've been there before and it was a little, a little intense. And then Jalen Brunson does what he does. This team works together so well and they clinched it. It was incredible.

[Host]

You have to call him my jalen. Mrs. Keene is calling my Jalen this week. My Jalen Emory ordinance. I got to ask what was in the arena? The energy that was not captured for America on tv.

[Annmarie Horden]

I think what was not captured was the moment you realize they were about to become champions after 53 years. There was literally, literally tears from New Yorkers and their faces. Grown men just absolutely crying. One guy next to me was a New Yorker, stayed for the whole thing, moved to San Antonio in 1994. So he was technically there supporting the spurs. But even he was emotional and he said, this is pretty bittersweet for me.

[Announcer]

For our fans on radio, I just have to highlight the outfits that are in this studio here. Rebecca Patterson, New York Knick orange, head to toe. Fantastic. Emory Hordern comes in, got the blue, the whole thing going, and the times got the bling.

[Paul]

I mean, I didn't know Tom either.

[Annmarie Horden]

You were a Celtics fan.

[Announcer]

Well, we're all Knick fans today.

[Paul]

Yes, Everyone. It's upset that I just sold him out.

[Host]

Who writes the paycheck? One more question for Rebecca Patterson here. The spirit of this, to me, the single missed call and New York City in the gloom was a census of 2020 where everybody, including smart people, said, oh, we added 600,000 in the MSA here. I mean, it's this bet against New York that's always been there.

[Paul]

You know what? I think there is a human emotion that you always want to go after whoever's on top. And that could be a company, it could be person, it could be a city. So it's easy to go after New York. But look, New York's back. People are working five days a week in the office. Real estate prices are coming back. God, I mean, last week if you tried to get around the city in a cab or even on the subway, it was packed.

[Host]

Yeah. Rebecca, thank you so much. Rebecca Patterson with us writing for the Council on Foreign Relations, a terrific podcast with Sebastian Bellamy.

[Announcer]

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