Fed Interest Rate Hike May Put Chair Kevin Warsh on Collision Course With Trump

Federal Reserve policymakers began their two-day meeting to set interest rate policy on Tuesday, and financial markets view a rate hike as likely despite President Donald Trump's calls for lower borrowing costs.Fed Chairman Kevin Warsh and the 11 other voting members of the Federal Open Market Committee will cast their votes on rate policy on Wednesday. Following more hot inflation data last week, bond markets estimate a more than 90% probability that the panel will increase the Fed's benchmark interest rate by a quarter-point.It would mark the first increase to Fed rates in three years, taking the benchmark rate from its current top range of 3.75% to a new high end of 4.00%. Mortgage rates have already climbed sharply toward 7% in anticipation of the move, averaging 6.76% last week, according to Freddie Mac.For Trump, the prospect of a rate hike comes as unwelcome news. The president has called on the Fed to cut rates, saying on Sunday: "The United States is so strong, we should be paying the lowest interest rate in the world."Warsh, who took over the chairman's role in May, had also called for lower rates before taking the job. But the economy's resilience and persistent inflatio...