Warsh Hints at Rate Rise as US Inflation Surpasses Target

The US Federal Reserve Chairman, Kevin Warsh, has hinted at raising interest rates in September. In a speech to central bankers, Warsh emphasized the need for underlying inflation to move towards the Fed's target rate of 2%.

US inflation numbers have been above 3%, and this has led to expectations that rates may be raised at the next Fed meeting on September 17th. Warsh stated that 'we must be confident that underlying inflation is moving to our objective, clearly and at sufficient speed... otherwise, we have work to do.'

According to Rupert Thompson, chief economist at IBOSS, markets were more concerned with recent events in Wyoming than the conflict in Iran. The global economy has shown resilience in the face of the oil price shock.

However, this hawkish line from Warsh may clash with Donald Trump's views on monetary policy. Trump has expressed the persistent view that US base rates should come down.