Warsh held a press conference after the Federal Open Market Committee (FOMC) decision to increase the policy rate by 25 basis points in line with expectations.
Stating that the bank's decision was taken at a time when the US economy was seen to be strengthening, Warsh said that indicators such as new hiring, private sector earnings, and capital investments of businesses have improved in recent months and point in a positive direction.
Warsh pointed out that the credit flow was strong, especially for companies, and said, "As I said at the policy symposium in Jackson Hole, I have difficulty describing general financial conditions as restrictive. This view was widely shared by the Committee. Therefore, we reduced the supportive stance somewhat." he said.
"Our main focus is on the price stability side of our mandate."
Stating that the Fed is in a good position in the field of employment, one of its mandates determined by Congress, Warsh stated that, on the other hand, inflation has been above the target for more than 5 years.
"So our main focus is on the price stability side of our mandate. The reality is that inflation is very high and has been for a very long time," Warsh said. he said.
Stating that the inflation data announced this summer does not show that the basic trends have improved significantly, Warsh reminded that he pointed out in Jackson Hole that general commodity prices should also be followed, and that the prices of many of these basic inputs increased in the period between meetings.
Warsh emphasized that it is necessary to ensure that the underlying trend of inflation is progressing clearly and at a sufficient pace towards the target.
Stating that the committee decided that this standard was not met today, Warsh stated that the unanimous decision showed its determination to reach price stability more quickly.
"Inflation risks are to the upside, while labor market risks are roughly balanced."
Warsh also touched upon the bank's economic projections and stated that they reflect the views of the Committee members, but he did not present a projection as in June.
"Inflation risks are to the upside, while labor market risks are roughly balanced," Fed Chairman Warsh said. made his assessment.
Pointing out that it has been clearly seen that most of the developed economies are facing price pressures in the last few weeks, Warsh stated that central banks are making their assessments in line with their own areas of responsibility.
"Today's decision reflects our best judgment within our mandate," Warsh said. he said.
"I believe that the inflation trends in the summer months do not meet the desired criteria."
Answering the questions of members of the press, Warsh explained that they cannot affect any individual prices, including oil prices, but they will ensure that they do not spread to the general price level.
"I'm not in the forward guidance business. I'm not going to make any judgments about the decisions we make in the future," Warsh said. he said.
Underlining that they made today's decision in line with their evaluations of the course of employment and the strength of the economy, Warsh emphasized that possible steps are priced in the markets from time to time, but they did not make their decisions in this direction.
Warsh, on the question of US President Donald Trump's call for the Fed to reduce interest rates, said, "The decision we took today was the right step taken to fulfill the duty given to us by Congress to ensure price stability." he said.
In response to the Fed's question about what has changed since the last meeting, Warsh pointed to the state of the labor market, inflation trends and geopolitical developments.
"My assessment a few weeks ago was that summer inflation trends did not meet the desired criteria. I have seen little data since then that would make me change that view, so I remain of the same opinion," Warsh said. he said.
"I'm not waiting for the data 'with bated breath'"
Emphasizing that he is not waiting for any data "with bated breath", Warsh pointed out that what is important is not individual data containing "noise", but trends.
"Single data contains misleading fluctuations. Focusing too much on them is a dangerous obsession. This is not something I'm concerned about," Warsh said. he said.
Warsh attributed the rise in bond interest rates to three reasons and listed them as economic strength, increase in capital expenditures and geopolitical developments.
Warsh explained that he reaffirmed his commitment to ensuring price stability in June, and emphasized in August that they were committed to discipline, not a decision.
Underlining that today's decision begins to show that they are serious about this issue and that they will achieve the price stability goal, Warsh said, "We will say more on this issue as we continue our discussions over the coming weeks and months, but I am not prepared to make any pre-judgements about future actions." he said.
