Rep. Troy Downing Says Fed Chair Kevin Warsh Has No Choice but to Raise Rates

During Tuesday’s edition of Bloomberg’s “Balance of Power,” Montana’s own Rep. Troy Downing (R‑MT) made it plain that Federal Reserve Chair Kevin Warsh isn’t really faced with a decision – he has to hike rates. The reason? Inflation numbers still missing the Fed’s 2% goal.

“I expect an increase,” Downing said, watching the latest data slide past the target. “Warsh really has no choice other than a slight uptick.” He added that, while the administration might not love the news, it shows the central bank is serious about tackling price pressures.

Downing acknowledged the awkward timing – a rate move just months before a midterm election – but argued it’s the right move. “It’s always difficult to do something right before an election, but this is due and will help cool the economy,” he explained.

The congressman also flagged the broader backdrop: soaring energy costs, a “temporary” spike linked to turmoil in the Middle East, and other supply‑side headwinds. “Everyone sees what’s happening with energy,” he noted, “and we all know it’s a short‑term thing.”

Looking ahead, Downing said he’d be surprised if the Fed didn’t opt for a modest 25‑basis‑point hike. “I don’t have a crystal ball, but that’s what I’m expecting,” he concluded, insisting the policy direction is sensible, not harmful.