Warsh says too many inflation categories still running above 3%
Warsh says the Fed's predominant focus remains price stability, not the labour market.
Published · Updated
UpdateWednesday, September 16, 2026 at 4:20 PM ET
Fed Chair Kevin Warsh said multiple categories of goods and services have shown price increases above 3% over both six-month and 12-month periods.
UpdateWednesday, September 16, 2026 at 2:40 PM ET
Warsh said the labour market side of the Fed's mandate is in good shape, pointing to a low jobless rate along with rising job openings and working hours.
Kevin Warsh said too many inflation categories are still rising above 3%, and that the Federal Reserve's predominant focus remains price stability rather than the labour market.
The remark echoes what Warsh said earlier this year, when he called inflation too high for too long and said summer data showed little improvement.
The comment comes after the Fed raised its benchmark rate by 25 basis points to a range of 3.75% to 4%, a decision that passed 12-0. Fed officials' own projections show 12 members expecting rates at 4.1% by the end of 2026, four expecting 4.4% and two expecting 3.9%, with the long-run neutral rate revised up to 3.25%. Traders had priced in a 95% chance of that hike before it happened, and are now betting on one more increase this year, in line with the Fed's median projection.
Deutsche Bank's Matthew Luzzetti has said the Fed's patience has run out and that he expects a quicker return to its 2% target. Warsh's remark reinforces the central bank's stated commitment to price stability over labour market concerns, aligning with the recent rate hike and with what markets are already pricing in for further tightening this year. Broad-based inflation persistence above 3% validates the hawkish stance already reflected in rate futures, leaving the policy path largely unchanged from current consensus.