Fed Chair Warsh says inflation remains 'too high'

US Federal Reserve (Fed) Chairman Kevin Warsh said inflation remained too high, despite a resilient economy and growing artificial intelligence investments.

Speaking at the Jackson Hole Economic Symposium on Friday, Warsh evaluated the current economic landscape and monetary policy.

He noted that while labor markets remained stable and output was solid, the inflation rate was still concerning.

The chairman emphasized that the Fed's preferred measure of inflation stood at 3.7% over the past 12 months.

He added that the six-month change was even higher at 4.1%, well above the central bank's firm 2% target.

Warsh stressed that policymakers must be confident that underlying inflation is clearly moving toward their objective at a sufficient speed.

"While this summer's personal consumption expenditures and consumer prices index readings were better than expected, they do not tell me that underlying trends have meaningfully improved," he said.

He warned that if this was not the case, the central bank still had work to do to achieve price stability.

On the employment side, he described labor markets as consistent with full employment, citing a historically low jobless rate of 4.1%.

The chairman also addressed the transformative potential of AI for the broader economy.

He stated that progress in this general-purpose technology had been faster than experts predicted just two years ago.

The central bank watched these developments attentively, as artificial intelligence could become a new factor of production, he said.