Federal Reserve Chairman Kevin Warsh used his appearance with CNBC’s Sara Eisen at the ECB Forum on Central Banking to reaffirm his stance against forward guidance. Speaking to investors, he made clear that Committee commentary will be driven by real-time economic data rather than pre-signaled policy paths. He also expressed optimism that advances in AI could eventually deliver more timely and precise economic data, reducing the lag between when information is gathered and when it reaches policymakers.
On the question of Fed independence, Warsh was unequivocal in his support, framing his primary focus as bringing inflation back toward the 2% target. While he acknowledged that inflation risks have moderated, he stopped short of declaring comfort with current levels. When pressed on his broader strategy, he offered little detail, suggesting that his approach would become clearer in time.
Warsh did indicate support for reducing the Fed’s balance sheet but declined to commit to a specific plan. Looking further ahead, he expressed hope that within nine to twelve months the Fed would be leveraging new technologies to better understand the real economy — giving central bankers the sharper, more current data they need to make more informed decisions.
