U.S. Federal Reserve Chair Kevin Warsh emphasized the Fed's commitment to price stability on the 16th (local time), stating, "Inflation has been too high and has persisted for too long."

Speaking at a press conference following the Federal Open Market Committee (FOMC) meeting that day, Chair Warsh said, "Today's policy action will help return inflation more timely to the committee's 2% target," adding, "Our committee will achieve price stability."

At the FOMC meeting, the Fed raised its benchmark interest rate by 0.25 percentage points to a range of 3.75% to 4.00%.

"As I said at the Jackson Hole Economic Symposium, overall financial conditions are hard to view as restrictive," Warsh said, noting, "This view was widely shared within the committee."

"Therefore, we removed some of our accommodative stance," he said, adding, "This is to ensure that financial and credit conditions are more aligned with our ultimate goals."

While diagnosing the U.S. economy as solid, Warsh repeatedly pointed to the severity of inflation.

"Today's decision was made at a time when the U.S. economy appears strong," he evaluated, stating, "Indicators such as job growth, private-sector income, and business equipment investment have improved in recent months and are pointing in a positive direction."

He continued, "However, inflation has exceeded our target for over five years," explaining, "The clear fact is that inflation is too high and has persisted for too long."

Regarding the future policy direction, Warsh reaffirmed his stance that the Fed will not provide forward guidance.

He also pointed out that "individual data indicators such as the Consumer Price Index (CPI) and retail sales contain a lot of noise," noting that "data dependency is a dangerous obsession."

He then emphasized, "What matters is the trend."

Regarding President Donald Trump's past pressure to cut interest rates, Warsh said, "I have nothing to say about discussions with the President," while emphasizing, "Those who are the least well-off have the most to gain from price stability.

Today's decision was the right one to fulfill the mandate given to us by Congress to ensure price stability."

In response to repeated questions regarding President Trump's remark that he would cut off trade with certain countries if the Fed does not lower interest rates, Warsh said, "Part of the Fed's independence lies in staying in our own lane."

He added, "Independence is a two-way street."

A two-way street can also mean a relationship where both sides have mutual obligations and give and take.

It is also interpreted as a metaphor that President Trump's pressure is not a relationship where one side unilaterally prevails.

Warsh added, "We will leave those who handle trade policy and fiscal policy to stay in their lane," and noted, "This is how we are able to stand here and speak about the situation as we see it."

He cited three reasons for the rise in U.S. long-term Treasury yields: ▲ the strength of the U.S. economy, ▲ fundraising competition among hyperscalers (large-scale data center operators), and ▲ geopolitical risks and energy and commodity pressures.

(Photo: Getty Images)