Warsh: Semiannual Monetary Policy Report to the Congress

The Consumer Price Index for All Urban Consumers (CPI-U) decreased 0.4 percent on a seasonally adjusted basis in June after rising 0.5 percent in May, the U.S. Bureau of Labor Statistics reported today. This decline in the all items index was the largest 1-month decrease since April 2020 when it fell 0.8 percent. Over the last 12 months, the all items index increased 3.5 percent before seasonal adjustment. The index for energy fell 5.7 percent in June after rising 3.9 percent in May, 3.8 percent in April, and 10.9 percent in March. The energy index was the largest contributor to the monthly all items decrease, more than offsetting increases in other indexes including those for shelter and food. The index for food increased 0.2 percent over the month, as did the index for food at home and the index for food away from home. The index for all items less food and energy was unchanged in June. Indexes that decreased over the month include motor vehicle insurance, communication, apparel, medical care, and used cars and trucks. Conversely, the indexes for recreation, household furnishings and operations, and personal care were among the major indexes that increased in June. The all items index rose 3.5 percent for the 12 months ending June after rising 4.2 percent for the 12 months ending May. The all items less food and energy index Consumer prices rose 3.5% annually in June, less than expected as energy prices eased Consumer prices posted their biggest decline in more than six years during June as a sharp swoon in energy prices provided at least temporary relief from this year’s inflation surge, the Bureau of Labor Statistics reported Tuesday. The consumer price index, a broad measure of costs for goods and services across the U.S. economy, was lower than expected across the board. CPI fell a seasonally adjusted 0.4% for the month, bringing the annual inflation rate down to 3.5%. Economists surveyed by Dow Jones had been looking for a drop of 0.2% and an inflation rate of 3.8%, following the 4.2% reading in May. The monthly drop in headline inflation was the biggest since April 2020. Core CPI *declined* in June, falling -0.02% and reducing the 12-month rate to 2.6%. Headline CPI also fell, and by a larger-than-expected -0.42%, lowering the 12-month rate to 3.5%. pic.twitter.com/m2o2xGLFvd

Fed's Warsh: We want economic growth to be more broad-based. Fed's Chair Warsh: We want an increase in inflation to be more limited. Fed's Chair Warsh: This isn't a time for the Fed to pass the buck on inflation. Fed's Warsh: Fed is making a commitment on price stability, 2% goal on inflation. Fed's Chair Warsh: The Fed has the tools to deliver price stability.

Fed's Chair Warsh: Right now, task forces are in discovery mode. Warsh on the task forces: "They get to share their views first" with the FOMC. But "there's going to be nothing held in secret here" Fed's Warsh: Any changes in balance sheet policy would be previewed. WARSH FROM THE FEDERAL RESERVE SAYS THE GOAL IS TO ELIMINATE POLITICAL INFLUENCE FROM THE CENTRAL BANK. WARSH STATES NO CHANGE IN COMMUNICATION STRATEGY REGARDING HIDING INFORMATION.