New Federal Reserve Chair Kevin Warsh eliminated forward-looking guidance from the FOMC statement following the June meeting, marking his first significant policy change since being sworn in on May 22. The FOMC kept interest rates unchanged, but the removal of guidance—a staple since 2003—has introduced new uncertainty, driving Treasury yields higher as bond prices fell. Warsh has also criticized the Fed's balance sheet and signaled a potential redefinition of price stability, though no changes to the federal funds target rate have been made. Analysts warn that rising yields could threaten the AI-driven stock market rally by increasing borrowing costs for data center expansion.
NVIDIA CorporationRising Treasury yields from removal of Fed guidance increase borrowing costs for data center expansion, threatening AI-driven stock rally.