US Federal Reserve to decide on possible rate hike in four weeks

The United States Federal Reserve will announce in four weeks whether it will raise interest rates, said Fed President Kevin Warsh at the European Central Bank Forum in Sintra, Portugal. Warsh gave no hint about the policy direction, noting that inflation pressures stem not only from high energy prices – which have eased as the United States and Iran move toward a preliminary peace deal and Brent crude fell to just above $72 a barrel – but also from a rapid surge in artificial‑intelligence‑driven investment.

He explained that firms are investing heavily in future supply, and if this expands the economy’s productive capacity, the implications for monetary policy could be “enormous.” The discussion came as the European Central Bank, dealing with inflation fueled by the Middle‑East war, lifted rates on 11 June, while its forecasts show European inflation unlikely to reach the 2 % target before 2027.