Rate-Hike Odds Climb Into a Fed Meeting Warsh Is Still Expected to Sit Out

Gold traded in a narrow band below $4,100 as market-implied odds of a Fed rate hike rose ahead of this week's meeting, even as most signs point to Chair Kevin Warsh holding rates steady.

Rate-Hike Odds Climb Ahead of the Meeting

Gold futures opened at $4,083 per troy ounce Tuesday before slipping to $4,027, continuing to trade below $4,100 since July 14 ahead of the Fed's two-day rate-setting meeting. According to CME Group's FedWatch tool, the probability of a 25-basis-point hike rose to 35.8% Tuesday from 25.77% the prior week. Broader markets closed mixed Monday — the Dow up 0.51%, the Nasdaq down 0.18% — with Treasury yields mostly lower as falling oil prices pushed back against the inflation narrative.

Warsh Faces a Divided Committee

Investors see nearly a 40% chance of a rate increase this week per CME FedWatch, even though perhaps only three or four of a dozen voting FOMC members are pushing for an immediate hike. Warsh has committed to ending "forward guidance" and has signaled his reaction function is shaped by energy-price increases from the Iran conflict and rising costs for semiconductors and electricity tied to AI buildout.

Why Warsh Likely Holds

Analysis pointed to three reasons Warsh is unlikely to raise rates this meeting: he personally does not appear to buy the case for hikes, a hike would undermine the outcomes of his own task forces, and raising rates risks putting him at odds with the Trump administration politically.

Sources

• Gold prices today, Tuesday, July 28, 2026: Gold remains below $4,100 ahead of Fed meeting (yahoo_finance)
• Here Are Tuesday’s Top Wall Street Analyst Research Calls: Boston Scientific, Clorox, CrowdStrike, Exxon Mobil, Honeywell International, Intuit, Intuitive Surgical, Levi Strauss, and More (yahoo_finance)
• Analysis: Kevin Warsh's Fed press conference will be revealing even without a rate hike (cnbc)

Not investment advice.