Federal Reserve Chairman Kevin Warsh Addresses Inflation Concerns

Federal Reserve Chairman Kevin Warsh expressed concerns about inflation during his speech on August 28, 2026, at the Kansas City Fed’s annual symposium in Jackson, Wyoming. He described the economy as strong, with healthy labor markets, but stated that inflation remains too high and is not progressing toward the Fed’s two percent target. Warsh emphasized the need for confidence that underlying inflation is moving toward this objective, stating, "We must be confident that underlying inflation is moving to our objective, clearly and at sufficient speed. Otherwise, we have work to do." He highlighted indicators of economic strength, including high profits, robust business capital expenditures, and healthy consumer spending, while echoing calls from other Fed officials for potential rate hikes. Warsh noted that inflation numbers are troubling, citing that many items in the personal consumption expenditures price index are rising faster than three percent. He remarked that inflation is still above the Fed's target and that the focus should remain on prices. Warsh also suggested that the Fed should limit its forward guidance on interest rates to avoid creating ambiguity. He refrained from commenting on the likelihood of rate hikes but indicated that his views suggest a greater chance of such actions in the future. Following his speech, the implied odds of a rate hike in September increased from 35 percent to 55 percent, and the odds of two or more hikes by the end of the year rose from around 27 percent to 46 percent.