19/06/2026

BIZ & FINANCE FRIDAY | JUNE 19, 2026

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Fed chairman Warsh vows wide-ranging reforms o American central bank policymakers signal rate hikes on horizon

WASHINGTON: US Federal Reserve Chair Kevin Warsh on Wednesday vowed wide-ranging reforms at the central bank, as its rate-setting committee held rates steady but projected a rate hike by year-end to counter surging inflation. The Fed decided to hold rates steady at 3.50 to 3.75 per cent for the fourth consecutive meeting, with the vote being unanimous for the first time in a year. Speaking to reporters after his first meeting in charge, Warsh vowed to “deliver price stability” to Americans, with inflation currently at a three-year high. “Persistently high prices are a burden for the American people, but the recent past need not be prologue,” he said, acknowledging that inflation has been well above the Fed’s two-per cent target for years. In their Summary of Economic Projections (SEP), policymakers raised their forecast for the year-end interest rate, signalling that they expected one rate hike by the end of 2026. Policymakers said inflation remained “elevated”, partly due to supply shocks caused by skyrocketing energy prices triggered by US President Donald Trump’s war on Iran. Trump has launched an unprecedented assault on the Fed’s independence, opening a criminal probe into Warsh’s predecessor and attempting to unseat another governor in his quest for lower interest rates. Shortly after Wednesday’s meeting, the Republican said he found it “hard to believe” the Fed would raise rates, but said he backed Warsh, who he nominated to the position. The Fed has a dual mandate to keep inflation to its long-term two-per cent target while also maintaining maximum employment. On Wednesday, the signals were clear that the central bank considered the labour market to be healthy and was fully focused on lowering inflation. In the SEP, Fed policy makers raised their year-end projection for Personal Consumption Expenditures price index inflation from 2.7 per cent to 3.6 per cent. “The Fed’s ready to raise rates, it’s clear,” Diane Swonk, chief economist at KPMG, told AFP. “The committee is really moving towards the issue of price stability being the number one issue.” The SEP was based on input from 18 of 19 policymakers, with Warsh withholding his forecast. The new Fed chair has said he wants to reduce the amount the central bank communicates about its decisions. During his briefing with reporters Warsh cut a polite figure determined not to say more than he intended, and to shift expectations on how much markets should expect to hear from the Fed chair.

Warsh speaks during the press conference in Washington. – AFPPIC

normal, and removed forward guidance on the direction of the interest rate, which has been a constant in recent years. Pao-Lin Tien, an economics professor at George Washington University, said that moving towards more opaque monetary policymaking could mean inflation expectations are less anchored. “Our fear would be that without the forward guidance, inflation expectations might become a little bit more volatile,” she said. – AFP

productivity and employment, and the Fed’s inflation frameworks. The task forces were expected to deliver findings by the end of the year, he said. Swonk said Warsh’s tone indicated that he realized that he needed “buy-in” from other Fed leaders to implement the changes he wants. “This is not an edict, it’s a collaborative process,” she said. Wednesday’s statement was shorter than

“What we’ve given markets is a new chapter for the central bank – some fresh thinking,” he said, indicating he wanted financial markets to stop trying to interpret the Fed’s reaction to data and to parse that data on their own. Warsh announced plans on Wednesday to review five areas of Fed operations as he seeks to put his stamp on the US central bank. He said he would name task forces to formulate reforms on Fed communications, its balance sheet, its use of data sources,

Robots pour cocktails and run marathons, but still cannot multitask BOSTON: They can mix cocktails, run marathons and fold laundry. But humanoid robots are still a long way from doing lots of different jobs on command, whatever the marketing says. human with a remote control or stuck doing one narrow task. learns from vast amounts of images and video until it can predict what will happen next in the real world, such as how an object will shift when it is squeezed. But an android that can do a bit of everything is still years off. workers in a textile workshop in India. The stakes are higher than for a chatbot like ChatGPT. A robot acts in the physical world, so its mistakes can hurt someone.

Take Neo, the robot that 1X launched with great fanfare last October. It was billed as “the world’s first consumer-ready humanoid robot designed to transform life at home” – but was actually steered by a person off to the side. Progress is real, though, and artificial intelligence is driving it. “I think AI has extremely accelerated that growth,“ said William Okazaki of sensor maker Renesas. One big hurdle is the hands. Long the holy grail of robotics, they are getting close: robots can now grip with a delicate touch, and some sensors can even tell when they are touching human skin. Much of this comes from a new kind of AI known as a VLA model, short for vision-language-action. It blends written instructions with what a camera sees in real time, so the robot can link what it is looking at to what it should do. There is also the “world model” – an AI that

“If you want to move into a more social domain, it really has to be safe for the users around the robot,“ said Valentino Fagard of Japan’s XELA Robotics, which works on giving robots a sense of touch. Engineers can set limits – telling the machines not to grip too hard, or not to get too close to a person. But there is a catch. Like chatbots, these AI systems do not always behave the same way twice, which makes them hard to predict. “The issue with, call it the world model, or the end-to-end VLA, is they’re non-deterministic, they’re a black box,“ said John Black of Brain Corp, whose robots stick to a very specific task, like cleaning floors or checking store shelves. “They’re nowhere close to reaching the safety levels required,“ he said, because even the people who build these systems can not fully see why they do what they do. – AFP

The gap was easy to spot at the Robotics Summit in Boston in late May. The glossy brochures promised one thing. The people who actually build the machines said another. Elon Musk loves to show off his Optimus prototype, recently filmed jogging in short strides. Figure 03, a third-generation robot developed by Figure AI, can tidy and clean a living room by itself. China’s AgiBot and Matrix Robotics say their robots can greet visitors, serve coffee and give them a tour, a little like C-3PO from Star Wars .” The reality is more modest. “Most of the humanoids you see are being teleoperated, or they’ve got very specific paths and chores that they do,“ said Chris Matthieu of startup RealSense, which makes cameras for robots. In other words, many are either run by a

“For general purpose robots, it will take longer,“ said Daniel Fan of Innodisk, which makes parts for robots. Plenty of humanoids are already out in the world – Boston Dynamics’ Atlas at Hyundai, Hexagon Robotics’ AEON at a BMW site – but these are trials, not final products. “Until you actually get the robot actually trying to do the thing you think it can do, you don’t really know,“ said Charlie Kemp of Hello Robot, which sells robots for people with limited mobility. Running fully on their own, at scale, is not yet possible, “because there is not enough data“, said Xinrui Bi of AgiBot. To gather it, companies are setting up cameras everywhere to record human movement – from people cooking at home to