Federal Reserve Chair Kevin Warsh signaled that the central bank would be focused on bringing down inflation during a European Central Bank Forum panel Wednesday in Sintra, Portugal.
Warsh did not offer forward guidance, in keeping with a policy he articulated at June’s board of governors meeting, but indicated that the central bank was committed to meeting its inflation target.
“If there were people in the household or the business sector and the financial markets who thought that this central bank was going to be comfortable with an inflation objective above 2 percent,” he remarked, “well, I guess they’d be disappointed.”
According to the latest report of the Federal Reserve’s favorite measure, inflation is above 4 percent, year-over-year, with the consumer price index rising at a similar rate. That is expected to decline as the opening of the Strait of Hormuz allows energy prices to fall in coming weeks, but core inflation numbers indicate underlying inflation.
Warsh also emphasized the Fed’s independence, citing the Supreme Court’s ruling in Trump v. Cook as further proof for the Fed’s insulation from political pressure as it conducts monetary policy.
