Following Warsh's hawkish remarks, Trump stated that "raising interest rates" is absurd and that Warsh will do what he has to do.

US President Trump said at the White House on Monday that he has great respect for Federal Reserve Chairman Kevin Warsh and that on the issue of interest rates, "he will do what he has to do."

Warsh said at the Jackson Hole conference last Friday that if policymakers cannot gain enough confidence to confirm that inflation is falling toward the 2% target, then the Federal Reserve "still has work to do."

Following his speech at the Warsh-Jackson Hole Economic Symposium, Barclays predicts the Federal Reserve will raise interest rates twice more this year, in September and December. Previously, Barclays had anticipated no further rate hikes this year. Currently, the market's pricing in a September rate hike has risen to approximately 60%.

Trump has repeatedly urged lower interest rates. On Monday, Trump stated, "In my view, we should be paying interest rates far lower than anywhere else in the world. Raising rates is absurd."

As of July, the Personal Consumption Expenditures (PCE) price index, the inflation gauge favored by the Federal Reserve, remained at 3.7% year-on-year. With the midterm elections approaching in November, the cost of living and affordability are becoming key concerns for voters.

Federal Reserve officials will meet in September to discuss whether to adjust interest rates.

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