<p>Chairman Kevin Warsh drew a distinction between the Federal Reserve and the White House after the central bank raised interest rates despite President Donald Trump's calls for a rate cut.</p>
<p>Warsh, speaking at a press conference in Washington on September 16, 2026, was asked by the Washington Examiner whether the decision to raise rates could be seen as a test of the Fed’s independence. He did not provide details about any conversations with the president.</p>
<p>“Part of the independence of the Federal Reserve is that we stay in our lane,” Warsh stated. “Independence is a two-way street. We let people that do trade policy and fiscal policy stay in their lane, too. That’s how we can stand up here and call them [the] way we see them.”</p>
<p>The remarks followed the Fed's unanimous vote to raise its interest rate target by 0.25 percentage points to a range of 3.75% to 4%. Investors largely anticipated this move.</p>
<p>Warsh has not faced criticism from Trump since his nomination earlier this year. Instead, Trump has directed his criticism towards the broader Federal Open Market Committee, as interest rate decisions are made by majority vote.</p>
<p>Warsh's vote to raise interest rates indicates the Fed's commitment to reducing inflation, even as Trump advocates for lower rates ahead of the midterm elections.</p>
<p>Prior to the rate decision, Trump threatened to cut off trade with countries that have a trade deficit with the United States if the Fed did not lower interest rates.</p>
<p>Warsh’s predecessor, Jerome Powell, experienced significant pressure from the White House to lower interest rates, a situation Warsh has not encountered. Trump appointed Powell to the Fed chairmanship.</p>
<p>Inflation remained at a rate of 3.4% for the year ending in August, according to the Bureau of Labor Statistics, which is above the Fed’s target of 2% inflation, a goal the central bank has not achieved in recent years.</p>
<p>During the meeting, the Fed also updated its projections for inflation and other economic indicators such as GDP and unemployment.</p>
<p>Fed officials project inflation, as measured by the personal consumption expenditures index, to be at 3.7% by the end of the year, an increase from the previous projection of 3.6% made in June for the end of 2026.</p>