Live Blog: New Fed Chair Kevin Warsh's First Post-FOMC News Conference

New Federal Reserve Chair Kevin Warsh gave his first post-FOMC news conference Wednesday after the central bank's monetary-policy committee left its key rate unchanged.

The Federal Open Market Committee kept its benchmark Federal Funds rate untouched at a 3.5%-3.75% range, as Wall Street had widely expected.

However, the committee's latest communique removed language that previous statement had included about the central bank having a bias toward cutting rates to boost the U.S. economy.

Equities investors typically like rate cuts because those tend to lower bond and money-market yields, making stock returns look more attractive in comparison.

The Dow-30, S&P 500 and Nasdaq Composite all turned from slightly positive to slightly negative following the FOMC statement's release.

The $Nasdaq Composite Index (.IXIC.US)$ was down 98.8 points (0.4%) at 26,277.54 as of about 2:10 p.m. New York time, while the $S&P 500 Index (.SPX.US)$ lost 29.75 ticks (0.4%) to 7,481.60 and the $Dow Jones Industrial Average (.DJI.US)$ eased 76.86 points (0.2%) to 51,922.81.

Here is a live blog of Warsh's press-conference remarks:

U.S. Jobs Market Looks 'Stable'

Warsh said FOMC members "thought the labor markets were stable -- there were some on the committee who thought it was better than that. I would say the jobs data has been moving in a good direction."

He added that "strong, productivity-led [job and economic] growth is not something we fear, but something we embrace."

FOMC Split on Rate Hikes vs. Cuts

Warsh said his 18 fellow FOMC members seemed evenly split at their meeting on whether the Fed's next move should be to raise or cut rates.

"Half of my colleagues think the [Fed Funds rate] should be at this level or lower and the other half thought higher," he said. "That 19th voter was me and I didn't submit [a forecast]."

Warsh Doesn't See FOMC Facing 'Cruel Choice' of Jobs vs. Inflation

The central-bank chief said he doesn't believe the Fed must face a "cruel choice" of either higher U.S. inflation or higher American unemployment.

"What I believe is that if we do our job, we can make strong growth, low prices and strong employment mutually compatible," he said, but added that "we've got some work to do on the price-stability front."

Fed Should Consider Updating Data Sources

Warsh said he wants to review the economic data that the Fed uses to see whether the information needs modernization.

He said the central bank sometimes uses out-of-date studies that rely on "survey methods that don't have response rates that we need, asking questions that were applicable in previous generations that aren't applicable now."

"We have to make hard decisions in real time," he said. "I'm really opened-minded that there are a lot of new sources ... that are far more refined than asking a simple question about whether something is poor or not poor."

Warsh Not Worried About Market's Post-FOMC Pullback

The central banker said he's not concerned about the fact that the Dow, S&P 500 and Nasdaq Composite indexes all eased following the FOMC's communique release.

"What we've given markets is a new chapter for the central bank -- some fresh thinking," he said. "What we've given markets and households and businesses is a commitment to ask ourselves hard questions to deliver on the promises that we've made before."

"I wouldn't be particularly intrigued with how [markets] have acted in the first few minutes or even the first few days" following such changes, he said.

Don't Read Much Into Dot Plot's Call for One Rate Hike

Warsh didn't put much stock into the fact that his fellow FOMC members' "dot-plot" estimates of the U.S. economy's future (formally know as the "Summary of Economic Projections, or "SEP") forecast one rate hike later this year.

"I reviewed the dot plots and when I saw the submissions, I noted that all of the submissions were coming in with pencil," he said. "I think my colleagues ... understand the world is changing quite quickly and they didn't feel bound by them six weeks from now or even six days from now as the world changes."

Fed Won't Change 2% Inflation Target Any Time Soon

Warsh has previously hinted that he doesn't mind if inflation moves a few decimal points away from the Fed's longstanding 2% target, which the U.S. economy has exceeded for five years.

However, the central banker said Wednesday that he doesn't plan to change the 2% goal any time soon.

"I see no reason until we have re-established out commitment and ability to deliver ... on the 2% objective to revisit that," Warsh said.

Fed Chief Confirms He Didn't Give 'Dot-Plot' Projections

Warsh confirmed that he did not offer his personal economic projections in the Fed's "dot plots" of economic forecasts.

The new chair has previously said he doesn't like the SEP's current set-up.

"I ... have refrained from offering any projections of my own, consistent with my long-standing views on the SEP," he said on Wednesday.

U.S. Economy Is Expanding, But Inflation Is Running Above Fed Goal

"Economic activity is expanding at a solid place despite elevated uncertainty that owes in part to the conflict in the Middle East," Warsh said. "Job gains have kept pace with the workforce, and the unemployment rate has changed little. We recognize that inflation has been running well ahead of the Fed's long-stated 2% inflation goal."

"Persistently high prices have been a consistent burden for the American people. (but) members of the FOMC are unanimous -- this committee will deliver price stability," he said.

Fed to Create Task Forces for Review Major Operations

Warsh said he'll create several task forces to review the Fed's current practices, from its release of FOMC members' "dot-plot" economic projections to his own press conferences.

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