Warsh Faces Pressure to Hike Rates Amid Surging Inflation

Federal Reserve Chairman Kevin Warsh is facing intense pressure to raise interest rates at next week's policy meeting after the recent inflation report showed a rise in underlying inflation. The core consumer price index, excluding food and energy costs, increased by 0.3% from a month earlier in August, according to Bureau of Labor Statistics data.

This development bolsters the argument made by several policymakers that the Fed must act to curb price pressures after more than five years of elevated inflation. As Omair Sharif, president and founder of Inflation Insights LLC, noted, 'For the Fed, it is time to put up or shut up.'

Investors' expectations for a rate hike have jumped above 85%, with some economists changing their calls in anticipation of an increase. Diane Swonk, chief economist at KPMG, said that now the question is not whether they hike but how much they need to hike to contain this inflation.