Warsh Suggests Rate Hikes May Be Needed for Stubborn Inflation

Federal Reserve Chair Kevin Warsh signaled that interest rate hikes may be needed to combat stubbornly elevated US inflation. In his first high-profile speech at the Fed's annual conference in Jackson Hole, Wyoming, Warsh acknowledged that recent US reports show inflation has cooled slightly. However, he emphasized that 'they do not tell me that underlying trends have meaningfully improved.'

Warsh's comments suggest a clearer signal of his economic outlook than previously sent by the central bank chair. The Fed is closely watching inflation levels, which remain higher than desired despite some recent cooling.