Fed Chair Warsh (Q&A): There is no soft inflation, no implicit inflation target; there's a target of price stability, and it's 2% as measured by PCE

• Inflation expectations have gone up in the near term, but longer-term measures show households and businesses have confidence that the Fed will deliver price stability.

This is a hawkish definitional statement: ruling out an implicit or flexible target and anchoring policy explicitly to 2% PCE closes off the interpretation, common in periods when inflation runs above target, that the Fed is quietly tolerating a higher range. Chairs have used this kind of reaffirmation historically when near-term expectations measures have drifted, precisely to keep the drift from migrating into longer-term measures, and the accompanying claim that long-term expectations remain anchored is the standard companion line in such episodes. The transmission channel is typically the breakeven curve: a firm restatement of the target tends to compress the near-term inflation premium embedded in front-end breakevens and term structure, while leaving long-horizon measures little moved if they were already anchored. The distinction worth drawing is between rhetoric and reaction function: whether this framing implies a higher bar for easing, or merely defends credibility while data-dependent language continues, is what separates a communication event from a policy signal. The tells are whether other officials echo the hard-target framing, how the statement sits against the latest PCE prints, and any shift in the committee's language at the next meeting. As Q&A commentary rather than a decision, the signal is directional and its weight depends on how the market had previously priced the Fed's tolerance for above-target inflation.