Fed Chair Kevin Warsh vows to curb inflation ahead of CPI release and congressional testimony

Federal Reserve Chair Kevin Warsh told Congress that fighting inflation is the Fed’s top priority and that “getting monetary policy right” will make the five‑year price surge “a thing of the past.” He emphasized the Fed’s independence, noting decisions will be data‑driven and not influenced by political pressure. Warsh’s testimony comes as the Bureau of Labor Statistics is set to publish the June Consumer Price Index, with most forecasts expecting headline inflation to fall to about 3.8% from 4.2% and core inflation to hover near 2.8‑2.9%.

At the same time, Fed Governor Christopher Waller warned that if core inflation remains “hot,” the committee may need to raise rates in the near term. Markets have priced a higher chance of a July rate hike, pushing the U.S. dollar near 13‑month highs and boosting Treasury yields. Geopolitical tension with Iran has lifted oil prices, adding further pressure on price dynamics.

Analysts note that strong AI‑related business investment is a prominent feature of the current economy, but it also fuels demand‑side price pressures. The combination of persistent inflation, potential rate hikes, and external shocks keeps policymakers on a tight‑rope as they prepare for the Fed’s July policy meeting.