Fed’s Kevin Warsh Says Inflation Risks Have Diminished, Vows ‘We Will Ensure Price Stability’ | Today’s news

Federal Reserve Chairman Kevin Warsh reiterated his commitment to returning inflation to the U.S. central bank’s 2% target, while acknowledging that policymakers still need to decide on tactics and a broader strategy to achieve that. He also pointed out that inflationary risks have decreased significantly in recent weeks, suggesting that price pressures are starting to ease.

“Inflation expectations have come down in the first four weeks of this period, inflationary risks have come down,” Warsh said on Wednesday, stressing that restoring price stability remains the central bank’s top priority.

“We’re going to ensure price stability in the US, that’s what this committee is committed to and our goal is to do that. The tactics, the strategy and the rest, that’s yet to come,” he adds.

Warsh was speaking at the European Central Bank’s annual forum on central banking in Sintra, Portugal.

“We will be an independent central bank”

Warsh also emphasized the Federal Reserve’s independence in setting monetary policy, despite President Donald Trump’s repeated calls to cut interest rates.

“We have been an independent central bank for a very long time. At this point we will be an independent central bank and you will not see any changes to that,” he said in a panel discussion at the ECB conference.

Warsh also said he would refrain from providing future guidance on future interest rate decisions, marking a major change at the U.S. central bank.

“We’re going to chart a new course,” Warsh said. “I want us to have a good family fight when we meet in four weeks,” he said, referring to another political decision.

Warsh previously said Fed policymakers agreed that future guidance was “not appropriate for the current political climate.”

“I said in my press conference that we’re not going to give advice because we’re meeting in six weeks,” Warsh said on a panel alongside other senior central bankers. “I have an update for you,” he added, noting that the July 28-29 meeting is now just four weeks away.

While Fed officials held interest rates steady last month, they signaled growing support for a hike this year as inflation runs at its fastest pace since 2023. Updated forecasts for the Fed’s benchmark rate showed that half of 18 officials expected a rate hike this year, though Warsh declined to offer a forecast.