The appointment of "hawkish" Warsh to head the Federal Reserve could trigger internal divisions within the Fed and market volatility.

Sonu Varghese, global macro strategist at Carson Group, said that if Warsh is indeed nominated to chair the Federal Reserve, we may end up with a Fed that is actually somewhat hawkish. Kevin Warsh has historically been a hawk, although he has recently been talking about rate cuts. If he enters the Fed advocating for significant rate cuts, he may not have much credibility in convincing others that further rate cuts are needed. We might even end up with a deeply divided committee that doesn't cut rates at all. In the short term, a potentially hawkish Fed could increase market volatility. (Jinshi)