Fed's Warsh Says He Won’t Tolerate Persistently High Inflation

Federal Reserve Chair Kevin Warsh said he would not tolerate a prolonged period of high inflation, according to prepared remarks released ahead of a House Financial Services Committee hearing on July 14.

“Our top priority is to conduct monetary policy correctly, or as close to correctly as possible,” Warsh said. “That is our clear and unwavering objective, and the standard that guides our direction.”

“If we conduct policy correctly, the surge in inflation over the past five years will become a thing of the past.”

Warsh also referred to last month’s Federal Open Market Committee meeting, the first he chaired after taking office. He said he and fellow policymakers recognize that high inflation has imposed an excessive burden on US households and businesses.

Committee members also share a firm commitment to restoring price stability rather than allowing price pressures to persist for an extended period, he said.

Based on that assessment, the Fed decided at last month’s FOMC meeting to hold its benchmark interest rate at 3.50% to 3.75%, according to Warsh.

Shin Yong-hyun, Hankyung.com reporter yonghyun@hankyung.com