Speaking at a news conference after the Fed kept interest rates unchanged, Warsh said the US economy was "pointing in the right direction."
"Is the economy running too hot? Is the economy running too strong? That isn't the judgment of most of my colleagues," Warsh said, noting that estimating the economy's potential growth rate remained difficult. He added that he did not believe economic growth itself was fuelling inflation or making the Fed's job more challenging.
"My judgment is we have seen an improvement in productivity. We can't measure it precisely. I think most of that change in productivity precedes everything we're talking about superintelligence, but productivity has been moving higher in the economy, however imperfectly measured."
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Warsh says politics did not influence rate decision
Addressing questions about the upcoming US midterm elections, Warsh said political considerations had no bearing on the Federal Open Market Committee's (FOMC) decision to keep interest rates steady.With voters set to head to the polls next Tuesday, Warsh stressed that the central bank's deliberations remained focused on economic conditions.
“politics played no role in the decision. I just spent two days with my colleagues upstairs. I didn't hear an utterance about politics. I didn't hear a reference to politics, elections, what's happening in the next week," the Fed official said at the press conference.
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Warsh says he does not expect involvement in Lisa Cook investigation
Warsh also said that, "to my knowledge" he would not be involved in a White House investigation into Federal Reserve Governor Lisa Cook over alleged misstatements on mortgage applications.The allegations are at the centre of President Donald Trump's efforts to remove Cook from her position. Trump first sought to fire her more than a year ago, prompting Cook to sue to retain her job.
The dispute reached the Supreme Court, which ruled this past summer that a president cannot remove a central bank official "at will" and must establish cause for dismissal.
Trump has since convened a three-member committee, led by his top economic adviser, to investigate Cook and hold a hearing on any evidence gathered.
(Disclaimer: This article is based on inputs from agencies. These do not represent the views of The Economic Times)
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