Warsh Flags Inflation Concerns as Fed Considers Rate Hikes
US Federal Reserve Chair Kevin Warsh expressed concern about inflation in his first speech at the Jackson Hole symposium on Friday, August 28. He praised the American economy's 'overall performance', but hinted that the central bank may need to act to curb high inflation.
'On the price-stability side of our mandate, the numbers are more concerning,' Warsh said. The US central bank has missed its long-term 2% inflation target for more than five years, with the latest measure coming in at 3.7%. The Fed's predominant focus should be on prices, and they must be confident that underlying inflation is moving to their objective clearly and at sufficient speed.
Warsh noted that recent data does not suggest meaningful improvement in underlying inflation trends. He stopped short of saying he would support a hike in interest rates, but hinted that it could be necessary. 'I stand here today committed to a discipline, not to a decision,' he said.