“The fact is, inflation is too high and has been for too long,” Warsh says. However, for more than five years, inflation has been above target, Warsh continues, so the Fed’s predominant focus is on the price stability side of its mandate. double quotes The obvious fact is that inflation is too high and has been for too long. He adds: “This summer’s inflation readings do not tell me that underlying trends have improved significantly.” statement.”American workers, families and small businesses have waited long enough for relief from high borrowing costs that make it harder to buy a home, start a business or get ahead. This is the wrong decision for working families that will only prolong the high costs they are paying.” soaring. It’s been more than two years since Trump promised to cut costs from “day one.” Instead, it has done exactly the opposite. ShareToday’s decision to raise interest rates was “inevitable,” says Richard Carter, head of fixed interest research at Quilter Cheviot, “with energy prices taking another step higher and inflation persistently remaining well above target.” And he added: double quotes. This is also a pivotal moment for Kevin Warsh. He came to the Federal Reserve as Trump’s man, ready to deliver the rate cuts he so badly wants. However, its first measure of significant impact is, in fact, an increase in interest rates, which risks hampering the relationship between the two and therefore repeating the attacks that Jerome Powell suffered during his mandate. Warsh hopes this action will be quick, although energy prices are ultimately what is driving inflation right now and not what is happening within the US economy. ShareDominic RusheIn a note to investors, Stephen Brown, chief North American economist at Capital Economics, said: double quotesThe Fed appears to agree with our view that today’s hike will be followed by another later this year. While the latest Summary of Economic Projections implies that the Federal Reserve can be content with just two increases in total, we believe that Federal Reserve officials are underestimating the potential for the unemployment rate to decline, meaning we maintain our forecast for a third increase also in early 2027. ShareDominic Rushe “I love inflation,” Donald Trump said in June, arguing that price increases were only temporary and would fall sharply once his war on inflation ended. Iran. But the war continues and so do high gas prices. Warsh previously argued that prices are too high: “The obvious fact is that inflation is too high and has been too high for too long. This summer’s inflation readings do not tell me that underlying trends have improved significantly.” double quotes: Today we made this decision based on our assessment of the situation. I’ll watch the market prices and see what they have to say. But today was our decision. Share ‘We’re still on our lane,’ Warsh says on Federal Reserve independence When asked by reporters, Warsh has refused to comment on Donald Trump’s repeated calls for rates to be lowered, not raised. It is another proof of the independence of the Federal Reserve, he reiterated: double quotes. You gave me a long menu to choose from, they are all very tempting. I have nothing for you about the conversations with the president. And I’m not a Wall Street newsletter. Part of the Fed’s independence is that we stay in our lane. Independence is a two-way street. We will let the people who make trade and tax policy stay in their lane. That’s how we can stand here and call them as we see them. ShareUpdated at 19.57 BSTWarsh adds on the rate increase: “Those who are least well off have the most to gain from a lasting expansion, a strong labor market and stable prices.” in the period between meetings. “In the last month in Wyoming, I expressed my commitment to a monetary policy discipline, not a decision. I defined the standard for action. We must have confidence that core inflation is moving toward our goal, clearly and quickly enough. “Today the FOMC decides that this standard has not been met.” “The fact is that inflation is too high and has been for too long,” says Warsh. However, for more than five years, inflation has been above the target, Warsh continues, so the Fed’s predominant focus is on the price stability side of its mandate. double quotes The obvious fact is that inflation is too high and has been for too long. He adds: “This summer’s inflation readings don’t tell me that underlying trends have improved significantly.” double quotesThe labor part of the Federal Reserve’s Congress deal is in good shape. ShareUpdated at 19:42 BST “Our decision comes at a time when the US economy appears to be strengthening,” says Warsh. Citing consumer spending, capital investment and other indicators, he adds: double quotes Consider the geopolitical landscape of shocks and uncertainty and you will begin to appreciate the resilience of the US economy ShareUpdated at 19:42 The chairman of BSTFed Kevin Warsh holds a press conference following the decision to raise rates Kevin Warsh is speaking now He starts by reiterating what the committee released in its press release I’ll bring you all the key lines here Democratic Congressman Brendan Boyle, who is the ranking member of the House budget committee, issued this statement in reaction to the news: Double quotes Today’s rate hike is further evidence that Donald Trump and the Republicans have failed on the economy. charge, inflation was falling. But just today diesel hit the highest price ever recorded. Trump’s reckless tariffs and the disastrous war in Iran have sent prices skyrocketing again, leading to the Federal Reserve’s decision to raise rates. Donald Trump will no doubt try to blame anyone but himself for this rate hike.
