June FOMC takeaways: Morgan Stanley's Seth Carpenter on the path of monetary policy

Summary

Seth Carpenter, Morgan Stanley's global chief economist, discusses the Fed's decision to hold rates and the monetary policy outlook. Rick Santelli contends that crude oil futures have served as a leading indicator for equities, signaling when to go long stocks. The panel debates Fed accountability, Kevin Warsh's reform ideas, and whether markets or central banks should set rates.

• Fed left interest rates unchanged with a median dot plot suggesting one hike this year.
• Kevin Warsh's comments prompt debate about refreshing Fed models and communication.
• Rick Santelli argues crude oil futures provided an advance warning to be long stocks as a conflict neared its end.
• Seth Carpenter sees risk of inflation undershooting Fed forecasts as oil drops and tariffs roll off.
• Discussion on whether markets should respond to data directly or to Fed interpretations of the data.
• Market pricing shifted from roughly one hike to more than one hike, but future path remains uncertain.