Warsh Signals Possible Rate Hikes to Combat High Inflation

Federal Reserve Chair Kevin Warsh delivered his first high-profile speech at the central bank's annual conference in Jackson Hole, Wyoming. He emphasized that inflation remains too high and hinted at potential interest rate hikes to bring it down.

Warsh acknowledged recent US data showing a slight cooling of inflation but expressed concerns about underlying trends. He stated that the Fed must be confident that inflation is moving towards its 2% target 'clearly and at sufficient speed.' If not, 'we have work to do,' he said.

The speech comes amid rising bond yields, which can increase borrowing costs for both the government and consumers. Warsh has previously avoided providing 'forward guidance' on interest rate policy, but his remarks may be seen as a signal that rates might need to rise in the coming months.