Warsh Inflation Warning Reshapes Rate Outlook and Pressures US Assets

Jackson Hole, United States, 29 August 2026 – Federal Reserve Chair Kevin Warsh has warned that underlying US inflation remains too high and that further interest-rate increases may be required, prompting investors to reassess monetary policy and the valuation of risk assets. His remarks at the annual central-bank symposium marked his clearest acknowledgement that the current setting may not be sufficiently restrictive to return inflation to the 2% objective.

Warsh said recent data showing some cooling did not demonstrate that underlying price trends had improved decisively. The Federal Reserve’s preferred inflation measure stood at 3.7% in July, while 54% of the goods and services tracked by the government recorded price increases of at least 3% over the previous year. That share is below its pandemic-era peak but remains well above the 32% average during the two decades before the pandemic.