ASX to retreat as Fed Reserve’s Warsh forces pivot on interest rates

The sharemarket is starting the week on the backfoot as traders scramble to recalibrate their United States interest rate expectations after Federal Reserve chairman Kevin Warsh delivered a hawkish message to the market, vowing to stamp out inflation.

After a week of turmoil in the bond market that pushed yields to multi-decade highs, Warsh appeased investors in his first major speech since taking the helm by reiterating that the world’s most influential central bank will return inflation to the 2 per cent target and if it doesn’t, policymakers “have work to do”.

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