We still lean toward the Fed holding rates unchanged on September 16, but the real decision point comes on September 11. Six reasons: 1. Hawkish words, no hawkish commitment. Warsh said the Fed has "more work to do" but never named a hike. He favors trimmed-mean PCE, a newer statistical gauge that in effect changes the ruler used to measure inflation. On that measure, inflation is closer to the 2% target. 2. The White House cannot afford a hike. Midterm elections are in November, and the stock market is the administration's most visible economic scorecard. A hike seven weeks before the election that knocks equities lower is not something Trump can accept, and Warsh is his own appointee. 3. This is supply-side inflation. Current inflation is being driven by energy and tariff pass-through, not by demand overheating. Oil remains the swing variable: as long as it does not spike sharply higher, the inflation data stay manageable. 4. The bond market is already doing the tightening. Treasury yields are at multi-year highs and federal interest costs exceed $1 trillion a year. Another 25 bp would add unbearable stress to the Treasury and to a financial system already priced tight. 5. Tariff cuts are coming. At this week's G20, Bessent said the US and China will keep cutting tariffs on about $30 billion of non-strategic goods each side. Cheaper imports pull goods prices down directly. 6. AI is a long-term force against inflation. Warsh himself called AI capex a "hyper Moore's law." AI lowers production costs, lower costs pull prices down, and that suppresses inflation without any need for rate hikes. The one variable that can overturn this view is inflation data itself. Waller conditioned his hold on the data, and Warsh anchored everything on the 2% target. That makes Friday, Sep 11, when August CPI is released, the real decision point.(BloFin Research)