No Easy Choice: The Fed’s September Rate Decision

On this episode of *America’s Gold Authority® Podcast*, host Mike Barnes is joined by Philip N. Diehl, President of U.S. Money Reserve and former Director of the U.S. Mint, and Brad Chastain, U.S. Money Reserve’s Managing Director and Global Head of Research, to examine the Federal Reserve’s approaching September rate decision and whether Chairman Kevin Warsh will follow through on his tougher rhetoric regarding inflation. Diehl and Chastain examine why inflation remains above the Fed’s target and why the expectations surrounding inflation may carry as much weight as inflation numbers themselves. Diehl points to a long-term shift in consumer expectations as a warning sign, arguing that the Fed faces increasing pressure to demonstrate its commitment to bringing inflation under control. The discussion also explores the growing divisions inside the Federal Reserve. With three policymakers supporting a rate increase at the previous meeting and other members potentially open to joining them, Diehl explains how the September decision could expose an unusually deep split over the appropriate path for interest rates. Chastain then takes a broader look at the relationship between economic growth, inflation, government debt, and interest rates. He explains why efforts to grow the economy faster than the national debt may ultimately put upward pressure on longer-term rates, complicating efforts to simultaneously encourage stronger growth and keep borrowing costs low. Looking toward September, markets remain divided over whether the Fed will actually raise rates. Diehl and Chastain discuss the economic data that could influence the decision, questions surrounding the Fed’s independence from political pressure, and how changing inflation expectations in the bond market could ultimately create a tailwind for gold. U.S. Money Reserve is one of the country’s largest private dealers of government-minted gold, silver, platinum, and palladium. It’s the only precious metals firm guided by two former U.S. Mint Directors, giving the company unrivaled institutional insight. Having served more than one million clients and processed over $4.4 billion in transactions, U.S. Money Reserve is widely trusted for helping Americans safeguard their financial future. Tune in to *America’s Gold Authority® Podcast* and request your FREE Gold Ownership Guide by calling 833-334-9781 or visiting https://usmr.gold/USMoneyReserve/POD78P