Warsh says US economy has strengthened, inflation is the problem

Sept 16 (Reuters) – Federal Reserve Chairman Kevin Warsh said on Wednesday that the U.S. economy has strengthened since Fed policymakers last met in June, with a labor market essentially running at full employment, while inflation trends have shown little improvement.

“Even over the last several weeks, I think we now have data broadly defined that says the economy has indeed strengthened,” Warsh told a news conference after the Fed hiked rates. “Underlying growth is higher. Inflation is the problem. Stable prices have been the problem for more than five and a half years.”

(Reporting by David Lawder; Editing by Chizu Nomiyama)