Following the Federal Reserve’s decision to hold rates at 3.75% – 4.00%, Fed Chair Kevin Warsh made important remarks at the press conference on 28 October 2026, addressing economic growth, inflation, and the path of monetary policy. Below are the key takeaways from the Kevin Warsh press conference.
Economic growth and the labor market
- He expected U.S. GDP growth in the third quarter to exceed 3%.
- He confirmed that economic growth has strengthened and that job growth is higher than a year ago.
- He noted that most Fed officials see the economy as not overheating, with an improvement in productivity.
Inflation and the 2% target
- He reaffirmed the 2% inflation target based on the Personal Consumption Expenditures (PCE) index, noting a recent rise in inflation expectations.
- He stressed that the Fed will work to achieve price stability, saying there is “no room for excuses.”
Monetary policy and the December meeting path
- He explained that the Fed needs more information to determine the appropriate policy and return inflation to target.
- He said: “We showed our readiness to act, and upcoming data will help determine the path of monetary policy.”
- He noted that a majority of FOMC members see the effects of monetary policy starting to show, and pointed to the removal of one easing measure in September.
- He declined to disclose his expectations for the December decision, saying the picture will clarify in the coming period.
Credit, markets, and investment
- He noted that credit conditions have become tighter and that investors are more cautious in allocating capital, with widening credit spreads.
- He pointed to a rise in oil futures, explaining that interest rates fell despite continued increases in oil prices.
- He emphasized the importance of interest-rate levels in stimulating investment in the technology sector.
Independence and internal reforms
- He stressed that political factors did not influence rate decisions.
- He explained that five working groups are intensifying their efforts and conducting regular reviews, while the specific details of the new FOMC meeting format have not yet been announced.
What do these statements mean for markets?
Warsh’s remarks reflect a balanced, hawkish-leaning tone: a strong economy with growth above 3%, against inflation above target and rising expectations. His refusal to signal the December direction keeps markets watching inflation and GDP data. Overall, the continued cautious tone supports the dollar and yields and keeps pressure on rate-sensitive assets such as gold.
Bottom line
The Kevin Warsh press conference confirmed the Fed’s commitment to returning inflation to 2% without pre-committing on December, alongside a strong U.S. economy and tighter credit conditions. Upcoming data remains the deciding factor for the monetary policy path.
Frequently asked questions
What did Kevin Warsh say about economic growth?
He expected U.S. third-quarter GDP growth to exceed 3%, confirming stronger growth and higher job growth than last year.
Did Warsh hint at the December decision?
No, he declined to disclose his expectations for the December meeting, stressing that upcoming data will determine the policy path.
What is the Fed’s inflation target?
The inflation target is 2% based on the PCE index, and Warsh noted that inflation expectations have risen recently.
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