Fed's Warsh Says There Is No Soft Inflation Target

Summary

Federal Reserve Chairman Kevin Warsh emphatically reiterates the Fed's unwavering commitment to the 2% inflation target, dismissing any notion of a soft implicit target. He notes that inflation remains elevated and the economy is resilient, and warns that five years of above-target inflation cannot be cured quickly. The speech signals a hawkish policy stance with no near-term rate cuts.

• Fed votes 9-to-3 to maintain federal funds rate at 3.50-3.75%
• Economy shows resilience with solid growth and steady job gains
• Inflation remains elevated relative to 2% goal
• Chair Warsh forcefully rejects any soft or implicit inflation target
• Committee united in delivering price stability and will not waver
• Acknowledges past five years of above-target inflation cannot be reversed in weeks