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Warsh to Reiterate Fed’s Pledge to Get Inflation Down
The New York Times • • business
Key Points:
- Kevin M. Warsh, the new Federal Reserve chairman, will affirm his commitment to reducing inflation during his first congressional hearing but has not yet indicated support for raising interest rates.
- Warsh emphasized that the Fed will set policy to end the inflation surge of the past five years and restore price stability, reflecting the committee's zero tolerance for persistent inflation.
- The Fed recently held interest rates steady at 3.5% to 3.75% during Warsh’s first policy meeting, signaling caution amid economic uncertainties.
- Warsh’s testimony coincides with the release of June’s Consumer Price Index report, which showed a sharp cooling in inflation due to falling energy prices linked to a temporary Iran war truce.
- Despite the positive inflation data, renewed conflict between the U.S. and Iran has caused oil prices to rise again, potentially undermining the recent easing in inflation.
