Think ahead why kevin warsh is wrong about inflation
中文标题
前瞻:为什么凯文·沃什对通胀的看法是错误的
Core conclusion · Tlines extraction
ING argues that Fed Chair Kevin Warsh's hawkish inflation narrative, based on the distribution of price increases, is misleading. The analysis highlights that the concerning chart is driven by goods prices, largely due to tariffs, which are now reversing. It points to improving underlying inflation trends, such as trimmed mean and market-based core PCE, and suggests a rate hike is possible but not clearly justified. The view leans towards Waller's more data-dependent stance.
- Institution
- ING THINK
- Published
- 09/04/2026
- Research topic
- Fed policy · US inflation · Inflation trend
- Time horizon
- current · 2026 · 6 months · medium-term
Key arguments
- Warsh's chart ignores weights, treating small categories like intercity buses equally with larger ones like doctors' services.
- Tariffs are the main driver behind the distribution shift, but tariff refunds now exceed revenues, reducing inflation pressure.
- Market-based core inflation, excluding imputed prices, is 0.3 percentage points below the headline core PCE of 3.3%.
- Trimmed mean inflation has fallen to near the Fed's 2% target.
- Six-month annualized core PCE has started to turn lower after cooler summer prints.
- Seasonal adjustment issues have contributed to earlier strength in H1 inflation.
- Declining rental growth and muted wage growth support optimism on inflation.
- A rate hike may occur, but the case is not compelling and could be a 'one-and-done'.
Key numbers
- Core PCE inflation
- 3.3%
- Market-based core PCE gap
- 0.3 percentage points below
- Share of price categories with inflation above 3%
- More than 50%
- Share of price categories with inflation above 5%
- A quarter
- Doctors' services weight
- ~4%
- Intercity buses weight
- ~0.006%
- Tariff refunds share of US imports in July
- ~10%
- Trimmed mean inflation trend
- Near 2% target
Main risks
- August inflation print could be hot due to energy costs, potentially triggering a precautionary Fed hike.
- Ongoing Middle East issues could pass through energy prices to core inflation via freight and airfares.
- Services inflation remains above pre-pandemic norms with little progress.
- Warsh might vote for a hike despite weak data, as his rhetoric is hawkish.
Corresponding source evidence
My main bugbear is that it purposefully avoids weights. Doctors' services, which account for roughly 4% of the inflation basket, are treated with exactly the same importance as intercity buses, which account for around 0.006%.
· currentTrimmed mean inflation has fallen in 2026 and now sits pretty close to the Fed’s 2% target, in sharp contrast to what most other measures are telling us.
· 2026The six-month annualised rate of core PCE inflation, a decent sense of the underlying trend, has started to turn lower after two cooler prints this summer.
· 6 months
Conditions / invalidation
- If Middle East issues persist
Context: the conclusion is Tlines' automated extraction, not the institution's wording. Quoted evidence is publisher wording. Scope and date must travel with the conclusion.
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AI analysis
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How this page was produced
Tlines extracted the conclusion, arguments, numbers and risks above from the report published by ING THINK on 09/04/2026, then structured them for comparison. The publisher's own wording is reachable through the source link on this page and is displayed in full above. Last updated 10/17/2026. Methodology · Source policy · AI usage · Request a correction