The Fed Raises Rates, and the Press Conference, at 30 Minutes, Becomes a Historic Event

WASHINGTON, D.C. — The Federal Reserve raised its benchmark rate by a quarter point Wednesday, the first increase in more than three years, and the press conference that followed lasted about 30 minutes, which makes it, per the wire story, the shortest on record for a Fed chair speaking after a regularly scheduled meeting. The Fed, when asked about the matter, said it had, in the specific, intended for it to be.

Chairman Kevin Warsh, in his first major move at the helm, hiked the rate against the open wishes of the President, who has described the Federal Reserve board as “hostile” and the decision as having been made “only for political reasons.” Warsh’s stated reason, per CNBC’s live coverage, was a single sentence he repeated, with variations, for the duration of the proceedings: “The plain fact is that inflation is too high.”

The 30 minutes did a great deal of work. A quarter-point hike, delivered with a record-brief presser, on the same week the ten-year yield crossed 5 percent for the first time in a decade, is not a data point the market is going to quietly absorb. The bond market, on this record, spent most of the day doing the thing markets do when the central bank and the President are, in the same afternoon, on opposite sides of the same decision: reviewing.

The economics are, for those following at home, a sentence and a clock. Inflation is, per the Fed, too high. The rate is, per the Fed, higher. The press conference is, per the Fed, over. The President is, per the President, correct, in the specific. The market is, per the market, reviewing.

The decision to hike, after three years of the opposite, is a pivot the market had been pricing in since, per the futures, “a while ago,” which is the phrase the bond desk uses when the decision is already in the price. The new Fed’s first move is therefore also, necessarily, the first move of a new Fed, a distinction the Fed made exactly once in 30 minutes, and then again, for the record.

The President issued a statement. The decision, he said, was “only for political reasons.” His successor at the podium, he said, is “doing exactly what I would have done, except later, and without the benefit of my advice,” which is, on this record, the highest form of the criticism.

At press time, the Fed said the rate is the rate, the press conference is the press conference, and the next meeting is, per the calendar, a date. When asked whether it expected the next press conference to also be 30 minutes, the Fed said, “as intended.”