Fed Chairman Seeks to Calm Concerns About Elevated Inflation
New York Times · LC · trust 37/100
In a high-profile speech, Kevin M. Warsh said that the Federal Reserve was chiefly responsible for taming inflation. If price increases did not return to the central bank’s target quickly, “we have work to do,” he said.
Listen · 9:55 min Share full article 125 Kevin M. Warsh, the Federal Reserve chairman, left, used a closely watched speech in Jackson, Wyo., to assure the public that the central bank is committed to tackling inflation. Credit... Natalie Behring/Getty Images By Colby Smith
Mr. Warsh, delivering his first address to the world’s leading economic policymakers at the Fed’s annual conference in Jackson, Wyo., affirmed that the central bank is chiefly focusing on getting inflation down after half a decade of it overshooting the Fed’s 2 percent target.
The Fed would not waver on that goal, Mr. Warsh said, although he stopped short of saying whether the current moment required higher interest rates.
“The responsibility for 65 months of sustained, elevated inflation sits squarely with the central bank — and that is where it belongs,” he said in prepared remarks.
“Here is my standard: We must be confident that underlying inflation is moving to our objective, clearly and at sufficient speed,” Mr. Warsh added. “Otherwise, we have work to do.”
Mr. Warsh made clear that adjustments to the Fed’s overnight rate, which currently stands at 3.5 percent to 3.75 percent, was the “predominant tool” to achieve both low, stable prices and a healthy labor market.
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