Robert Kaplan, vice chairman of Goldman Sachs (GS) and a former president of the Federal Reserve Bank of Dallas, told Bloomberg Television on Thursday morning that the rate-hike debate consuming markets this summer might not exist at all if not for a war. "In fairness, if we didn't have the war in Iran and the spike in oil prices, which I think has raised headline inflation and leads into other items, my guess is we may not even [be] talking about the prospect of a rate increase," he said.
That cuts against how the argument has been conducted all summer. The live question on trading desks has been whether the Federal Reserve's next move is up rather than down, and it has been fought almost entirely in the language of domestic economics: tariffs, labor supply, and the pace of AI-driven capital spending. Kaplan, speaking hours after the latest inflation figures landed, put the cause somewhere else: in a barrel of oil.
