With inflation running high, it is imperative that we restore it to 2% goal on a sustained basisCurrent stance of monetary policy is well positioned to do thatInflation is unquestionably too high at about 4%Encouraging reasons to expect that inflation has peaked and should edge down in coming quartersExpect overall inflation to decline to around 3.25% by year-end, continue toward our 2% goal in 2027 and land on target in 2028Medium- and longer-term inflation expectations remain well anchoredExpect real GDP growth to be around 2%-2.25% this year and over the next two yearsExpect unemployment rate to edge down gradually to 4% in 2028Full effects of the AI investment surge on growth, employment, and inflation are hard to predictSupply disruptions stemming from the Middle East conflict continue to be a source of risk to the outlooks for both growth and inflationGrowth in the economy is solid and on trend, and the labor market is likewise solid and stableWhile effects of Middle East conflict pose significant risks, US economy so far has absorbed these events fairly wellLabor market showing signs of resilience and stabilityCPI print was consistent with what I am hoping to see over coming months.CPI was a little piece of inflation run rate returning toward goal.Risks to energy prices inflation are somewhat less.Absolutely not any consideration to changing 2% target.Warsh believes in Fed's mission He understands how important it is to deliver price stability and maximum employmentWarsh is bringing fresh thinking that is very welcomeThere was a strong support to move away from forward guidance.We do not have a clear direction about which way interest rates are going war whenI do not have a particular view about where policy is goingWilliams isn't exactly pounding the table for hikes here but he's not pushing back on market pricing either. With inflation "unquestionably too high" at 4% and the funds rate apparently "well positioned," this reads like a Fed content to sit tight and let restrictive policy do the work — but the market isn't fully buying the patience story, pricing 27.7 bps of hikes by year-end. The "inflation has peaked" language is doing heavy lifting given the oil-driven supply shock from the Middle East is still live and explicitly flagged as a two-sided risk. If Hormuz risk premium sticks or the AI capex boom keeps growth at trend-plus, then patience doesn't sound like the right approach. This article was written by Adam Button at investinglive.com.