Fed has 'work to do' if price rises don't ease for Americans, Warsh says

Image source, Getty ImagesByMichael RaceBusiness reporter, Reporting fromNew YorkPublished28 August 2026The head of the US central bank has said policymakers will "have work to do" if they were not confident cost-of-living pressures were easing for Americans.

Federal Reserve chair Kevin Warsh said while inflation readings looked better than expected over the summer, they did not show that the current picture had "meaningfully improved".

The new Fed boss stressed that his remarks should not be treated as a guide for future interest rate decisions, but the comments are a signal rates could be raised if policymakers believe inflation is too high.

Latest figures show prices rose 3.4% in the year to July, above the Fed's 2% target. Another inflation measure closely watched by the Fed is running at 3.7%.

Warsh made the comments in his first speech at the annual Jackson Hole Economic Policy Symposium in Wyoming, which sees central bankers, government officials and academics from around the world gather to talk about interest rates, inflation and other economic issues.

Warsh said given prices were rising by more than 2% on an annual basis, "the Fed's predominant focus right now should be on prices".

"Here is my standard: We must be confident that underlying inflation is moving to our objective, clearly and at sufficient speed. Otherwise, we have work to do."

The central bank boss has remained tight-lipped about the potential path of interest rates, but investors will have watched his speech closely for any signs of the Fed's approach under his leadership.

The reactions to any decision made by US President Donald Trump will be closely watched, with the mid-term elections looming and voters concerned about affordability.

Trump, who appointed Warsh in May, repeatedly criticised and pushed his predecessor Jerome Powell to cut interest rates. The president has previously said rate hikes "just keeps the country down".

Warsh issued a plea in his speech to not label his remark as "forward guidance" and said he believed the practice of sending signals to the markets on future interest rate decisions, adopted in the wake of the 2008 financial crisis, had "overstayed its welcome".

"Oversharing policy deliberations and overcommitting to future decisions can lead markets, businesses, and households astray," he said, adding it also inhibited the Fed the "freedom to make the right calls when it's time to decide".