Arabic version: وارش يحذّر من مخاطر التضخم في جاكسون هول

According to Cnbc, Federal Reserve Chairman Kevin Warsh warned at the Jackson Hole Economic Symposium that elevated inflation remains a concern and that interest rates could need to rise if price pressures do not ease sufficiently. He said summer inflation readings had been better than expected but did not show that underlying trends had “meaningfully improved.”

Warsh said the Fed must be confident that underlying inflation is moving to its objective “clearly and at sufficient speed,” otherwise “we have work to do.” He did not commit to forward guidance or a reaction function that would specify the economic signals triggering a rate adjustment. “I stand here today committed to a discipline, not to a decision,” he said.

Markets rose after the 10 a.m. ET speech, while Treasury yields climbed. The policy-sensitive two-year Treasury note rose nearly 8 basis points to 4.31%, its highest level since late July. Traders increased the probability of a rate hike at the September policy meeting to 55.7%, about 20 percentage points above the previous day, according to the CME Group’s FedWatch tool.

Warsh said the economy “appears to have strengthened,” citing artificial intelligence as well as resilient business and consumer spending. He acknowledged slower hiring but attributed it to a flattening labor supply. The chairman also urged a “quieter Fed, more purposeful in its communications,” saying markets should not look primarily to the central bank for their next trade.

Since taking office in May, Warsh said he has begun five task forces examining Fed functions. He argued that economic forecasting remains uncertain as geopolitics, global supply chains and technology change rapidly, and said policymakers would seek more reliable models and more robust rules while remaining modest about what they can know.