Natixis' Christopher Hodge Says Warsh's Hawkish Start Could Create 'Credibility Trap'

Former New York Fed chief economist and Natixis U.S. chief economist Christopher Hodge said Fed Chair Warsh's hawkish early stance could form a "credibility trap." According to Odaily, Hodge said Warsh's dislike of "forward guidance" and the "dot plot" is reasonable in the current uncertain environment, but it also shows a tendency to take risks. Hodge said that if CPI data in the coming months are affected by noise from short-term disruptions such as tariffs or energy shocks, Warsh may be forced to raise rates because of his earlier position. Natixis expects the Federal Reserve to keep interest rates unchanged throughout 2026.