Top of the Morning: CIO Strategy Snapshot - Being Kevin Warsh

CIO expects just one more Fed hike then a long pause, while markets price three, favoring extended fixed-income duration and constructive equity positioning.

• Fed hikes as expected: The Fed raised rates last week with markets pricing a ~95% probability beforehand; CIO sees one more hike in December then an extended pause into 2027.
• Market vs. CIO diverge: Market pricing implies ~3 hikes over 12 months (50% odds of an October hike) versus CIO's one-hike, then-pause view; the Fed's own dot plot shows one more hike this year and none next year.

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