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Warsh: 'There is no soft inflation target' and a task force will review Fed data
Summary
Chair Warsh rejected the idea of a 'soft' inflation goal, reiterated the Fed's 2% target and said he has created a task force to revisit the private and public data used for policy decisions ahead of Jackson Hole.
Chairman Warsh said repeatedly that the committee has a single inflation objective and rejected interpretations that the Fed tolerated a higher implicit target.
"There is no soft inflation target," he said, adding that "there's only a target and it's 2%." Warsh said five years of inflation above target cannot be cured quickly and that expectations must be centered on the committee's 2% standard.
Warsh also said he has called for task forces to reassess the private and public data the committee uses for decisionmaking and that he will check back with them in the coming weeks. He described the task-force work as part of preparing for policy choices later in the year, including possible input for a Jackson Hole speech.
Reporters asked which inflation measure the Fed relies on. Warsh pointed to the January strategy document and noted personal reliance on PCE as the standard measure, while saying he examines a broader set of inflation data rather than a single series.
