Fed chair says delivering ‘stable prices’ is central bank’s job as inflation persists
Federal Reserve chair Kevin Warsh said the central bank remains focused on bringing inflation back to its 2% target, stressing that stable prices are its core responsibility. Although he gave no direct indication of upcoming interest-rate decisions, markets interpreted his remarks as suggesting rates could rise, potentially conflicting with President Donald Trump’s calls for cuts.
US inflation fell from 4.2% in May to 3.4% in July but remains above target, while the Fed’s policy rate stands at 3.5% to 3.75%. Three of 12 voting members backed a quarter-point rise in July, though the majority kept rates unchanged; Warsh also rejected using detailed forward guidance, saying the crisis-era practice had outlived its usefulness.
- Warsh says the Fed is still fighting persistent inflation.
- Markets see a possible signal of future rate rises.
- Inflation eased to 3.4% but remains above target.