Warsh: Fed is Committed to 2% Inflation Target
Federal Reserve Chairman Kevin Warsh said Wednesday the Fed is unanimously committed to bringing inflation down to its 2% target.
Speaking at his first press conference since being appointed to the position, Warsh added that nobody at the central bank wants rates to rise in the near term.
“We have the capability and commitment to deliver on price stability of 2%, and that’s exactly what we’re going to do,” Warsh said.
He stressed that participants on the Federal Open Market Committee are “evenly divided on what to do with rates,” although members currently do not strongly favor either raising or lowering them.
The Fed next meets in six weeks and should have a clearer idea at that time of the direction of the federal funds rate, he said.
Warsh added, in response to a question from The New York Times, that the institution had lost credibility over the past five years.
He said he has repeatedly noted that monetary policy can be used for either inflationary or deflationary purposes.
“You bet rates can be used for inflationary purposes,” Warsh said. “We are going to fix that.”
Tagged: Economy BACK TO HOMEPAGE