The Fed chair asked officials to submit written views on shrinking a calendar that has held eight meetings a year since Paul Volcker set it in 1981. Six is the number circulating in Washington.
Kevin Warsh has asked Federal Open Market Committee officials whether the Fed should meet fewer than eight times a year, a proposal first reported by the New York Times on 31 July and confirmed by Bloomberg and Fortune the same day.
Warsh raised the idea during his second meeting as Fed chair, which ended on 29 July. Rather than open a debate on the calendar in the room, he asked each policymaker to send him their views in writing. He left the impression, according to the reporting, that a revised schedule could be settled before the 15-16 September meeting, even if any change did not take effect until 2027.
The eight-meeting cadence has been in place since 1981, when Paul Volcker set it. Before that, the FOMC met somewhere between ten and nineteen times a year through the 1950s and 1960s, generally as circumstances required. The floor written into the Banking Act of 1935 is four meetings, and Warsh went out of his way at his April confirmation hearing to say that four is not enough, a line that has been read as guidance on where his preference sits.
Six is the number that has been circulating in Washington since the story broke. Six regularly scheduled meetings a year would be the sparsest FOMC calendar since the Volcker era.
The context is a chair who is not being received quietly by his own committee. The 29 July vote was 9-3, with three regional presidents dissenting in favour of a 25 basis point hike. That is the deepest split at an FOMC meeting since September 2016. Warsh told reporters afterward that there is "no soft inflation target and no soft implicit target on this committee's watch," a message deliberately different from the tone Powell had trained the market to expect.
Bitcoin has taken the point. Spot BTC opened Saturday at $62,868, down 3.25 per cent on the day, and the sell-off has extended into the new month. CME FedWatch is now pricing a 61.4 per cent probability of a September hike, up from 50.6 per cent a month ago. Odds of a rate cut this year sit at zero. Crypto is duration-sensitive and Warsh has now given three signals in eleven weeks that the front end of the curve is going the wrong way for it.
Fewer FOMC meetings would compound the effect. Every eight-week Fed print is a stress test for risk assets: positioning is stripped back going in, gap moves are common on the decision, then desks reload. Halving the calendar would concentrate that gamma into three or four dates a year and lengthen the intervals during which the market has to price rates off macro data alone. Volatility does not disappear when the Fed stops speaking. It migrates to the meetings that remain and to the intermeeting speeches from voters. Warsh has already indicated he wants those speeches to be rarer and more coordinated.
The substance of the proposal is that Warsh sees the current cadence as a source of policy noise rather than policy discipline. Under Powell, the eight-meeting rhythm produced constant repricing of the terminal rate as each dot plot updated and each set of minutes appeared. Warsh's argument, foreshadowed at his April confirmation hearing and now half-visible in the calendar proposal, is that the Fed's credibility is best served by moving less often and speaking less loudly. That is a Volcker-era instrument in the hands of a chair who has been open about wanting Volcker-era latitude.
For crypto, the operational risk sits in the transition rather than the endpoint. A calendar decided in the fortnight before the September meeting would trigger an immediate revaluation of the SOFR curve, of front-end Treasuries and of the leveraged basis trades that sit on top of them. Bitcoin miners and treasury companies that borrowed at 2024 rates and are still rolling that paper cannot afford another repricing higher, and the equity market has already started to work this out: public miner stocks gave up an average of 8 per cent in the week following the FOMC.
The proposal is not final and is not certain to pass. The committee has to agree, and past chairs have found that the FOMC does not enjoy being managed. But Warsh set a soft deadline for himself before September, and Fed chairs generally get the calendar they want. The current one has held for forty-five years. The odds it holds through 2027 have fallen sharply in three days.
