Kevin Warsh Will Be Sworn-In As Fed Chair Today — But The Bond Markets Aren't Giving Him A Grand Welcome

• According to data from the St. Louis Fed, Warsh is the first Fed Chair since Ben Bernanke to be sworn in with 10-year yields as elevated as they are now.
• Unlike Bernanke, Yellen, and Powell, who took office amid easing inflation, Warsh assumes the Fed's top job as inflation concerns are mounting.
• Analysts at ING Think highlighted that inflationary concerns are the key driver behind the ongoing bond market selloff.

Kevin Warsh is all set to be sworn in as the next Federal Reserve Chair on Friday, but the bond markets are not giving him the welcome that his three immediate predecessors received.

The 10-year U.S. Treasury yield stood at 4.56% on Friday, the highest level since January 2025, while the 30-year Treasury yield stood at 5.08%, the highest in about 31 months.

According to data from the St. Louis Fed, Warsh is the first Fed Chair since Ben Bernanke to be sworn in with 10-year yields as elevated as they are now.

The iShares 20+ Year Treasury Bond ETF (TLT) was up 0.12% at the time of writing, while the iShares 7-10 Year Treasury Bond ETF (IEF) was up 0.14%.

Bond Market Selloff Driven By Inflation Concerns, Say Analysts

Analysts at ING Think highlighted that inflationary concerns are the key driver behind the ongoing bond market selloff. “It’s worth reiterating that, unlike in 2025, this sell-off is being driven by inflation concerns rather than fiscal fears, making it unambiguously USD positive,” the firm stated in a recent note.

The firm stated that the bond sell-off is intensifying, with the 10-year Treasury yield hitting its highest level since early 2025 after hotter-than-expected inflation data. Rising price pressures are testing the Fed and bolstering the case of April's dissenting policymakers.

Rate Hike Fears Amid Rising Inflation Threat

Warsh is also set to take charge in a more challenging macro environment than his three immediate predecessors, namely Jerome Powell, Janet Yellen, and Ben Bernanke. The incoming Fed Chair will be sworn in amid growing concerns of rising inflation, while Bernanke, Yellen, and Powell inherited disinflationary environments.

The threat of rising inflation has also heightened fears of a rate hike.

According to CME FedWatch data, markets expect a 25-bps rate hike in October.

Meanwhile, U.S. equities gained in Friday’s pre-market trade. At the time of writing, the SPDR S&P 500 ETF (SPY), which tracks the S&P 500 index, was up 0.18%; the Invesco QQQ Trust ETF (QQQ) rose 0.14%; and the SPDR Dow Jones Industrial Average ETF Trust (DIA) gained 0.34%. Retail sentiment on Stocktwits regarding the S&P 500 ETF was in the ‘extremely bullish’ territory.

Also See: Trump Says US Will Get Highly Enriched Uranium From Iran — 'We Don't Need It, We Don't Want It... But We're Not Going To Let Them Have It'

For updates and corrections, email newsroom[at]stocktwits[dot]com.