Federal Reserve chairman Kevin Warsh warned inflation isn’t meaningfully slowing and said policymakers must be confident that it is, otherwise the central bank has “work to do.” In a sweeping speech, his first since becoming chairman of the central bank in May, Warsh reiterated that policymakers will return inflation to their 2% goal, which he said is a firm and fixed target.“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. That’s our job,” Warsh said in remarks prepared for Fed’s annual conference in Jackson Hole, Wyoming.Warsh said financial conditions are not restrictive and interest rates are Fed’s “predominant tool” for achieving its mandate, though he stopped short of signaling he would support an interest-rate hike when Fed officials gather in Sept. “I stand here today committed to a discipline, not to a decision.” Yields for two-year Treasuries rose five basis points to 4.28%, while 30-year rates slipped — signal of an expectation that Fed may need to raise short-term rates.
