Fed’s Hammack Warns Worsening Inflation Expectations May Require Stronger Response

Hammack's framing is notable because it ties the size of any policy move to the psychology of inflation expectations rather than to current data alone — a reminder that the Fed's reaction function can shift before the numbers do. For crypto and RWA markets, which have spent months trading on rate-cut expectations, the risk is that a hawkish Fed voice resets that narrative without any change in actual policy. The open question is whether this is one official's caution or the start of a broader shift in tone.