A hot April inflation report fueled by soaring energy prices is complicating incoming Fed Chair Kevin Warsh’s push for Fed rate cuts in 2026 and reshapes 2027.

Kevin Warsh, President Trump’s pick to run the Federal Reserve, would face a growing inflation challenge if he’s confirmed.

US PPI jumped 6% in April 2026, the hottest reading since 2023, slashing Fed rate cut hopes as services inflation broadens.

Incoming Fed Chair Kevin Warsh will have an inflation problem to tackle. It’s getting ugly too. The latest Consumer Price Index (CPI) repor t showed that US inflation has been above the Fed’s 2% target for 62 consecutive months now.

Will the Fed's dot plot be scrapped or modified under new Chair Kevin Warsh? Explore the implications for monetary policy, forecasts, and market transparency.

"I think we recognize, as does the Fed, that the cure for lower oil is not higher fed funds rates," says Brad Long, the CIO at Wealthspire.

Goldman Sachs doesn’t think the Federal Reserve will give the markets what they want. According to TheFly, the bank expects the next two Fed interest rate cuts to come in December 2026 and March 2027,

By Howard Schneider WASHINGTON, May 13 (Reuters) - Kevin Warsh will face a key moment in his first weeks as U.S. Federal Reserve leader when interest rate projections released at June's meeting could reveal to President Donald Trump and the world whether Warsh is as dovish about rates as Trump might hope or disappears into more mainstream Fed thinking.