03:56 PM EDT, 07/01/2026 (MT Newswires) -- Federal Reserve Chair Kevin Warsh said Wednesday that inflation risks have eased, suggesting the central bank may be headed for another policy pause.

Speaking at a European Central Bank forum in Portugal, Warsh said the Fed remains committed to deliver price stability in the US, reiterating what the Federal Open Market Committee said in its June policy statement.

"Inflation risks have come down," Warsh said. "If there were people in household or the business sector or the financial markets who thought that this central bank was going to be comfortable with an inflation objective above 2%, well, I guess they'd be disappointed."

The Fed kept its policy rate steady last month for the fourth consecutive meeting following a series of rate cuts last year. The central bank removed the so-called easing bias from its latest policy statement, while raising its interest rate expectations through 2028.

The June policy meeting was Warsh's first as Fed chief.

"The chairman's more favorable assessment of price pressures suggests an underlying support for maintaining the current level of policy as opposed to rate hikes," Stifel Chief Economist Lindsey Piegza said in a note.

The Fed's preferred inflation metric -- the personal consumption expenditures price index excluding food and energy -- accelerated to the fastest reading in more than two years in May, government data showed late last month.

Global oil prices tumbled 20% in June after the US and Iran agreed to a memorandum of understanding to end their war. Markets expect the Fed to keep rates unchanged again when it meets toward the end of July, according to the CME FedWatch tool.

"Of course, given Warsh's more dovish-leaning disposition (at least more recently), the chairman may be inclined to downplay the potential for and conversation around rate hikes, even if the (FOMC) appears to be moving in that direction," Piegza said.

Warsh suggested that the Fed will remain independent of the White House. His predecessor, Jerome Powell, was repeatedly criticized by President Donald Trump over a cautious policy stance.

"We've been an independent central bank for a very long time, we're going to be an independent central bank at this moment and you're going to see no changes on that," Warsh said at the ECB conference.