JACKSON HOLE, Wyo. — President Donald Trump’s new Federal Reserve Chair said Friday that although measures of inflation are still elevated, it is not yet clear that the central bank must take urgent action to address rising prices.

The speech at the Fed’s yearly retreat to Jackson Hole, Wyoming, had been eagerly anticipated after a rocky start to Warsh’s tenure. Market observers were concerned that Warsh had downplayed the risk of rising prices.

There were also calls for an interest rate hike from economists, including some within the Fed. Trump has routinely called for lower rates that would spark the economy but risk even greater inflation.

Warsh noted that the labor market looks “stable,” and said this was one reason that he saw prices as “more concerning.”

The Fed chairman noted that while readings of inflation this summer were “better than expected, they do not tell me that underlying trends have meaningfully improved.”

Warsh did not say how the Fed would react if prices keep rising at rates above the target of 2%. But he underscored that the chief tool for tackling inflation was rate hikes.

“We must be confident that underlying inflation is moving to our objective, clearly and at sufficient speed. Otherwise, we have work to do,” Warsh said.

Following Warsh’s speech, the odds that the Fed would raise its benchmark interest rate next month in order to cool inflation increased.

Warsh reiterated his preference for a “quieter Fed,” doing away with his predecessor’s use of “forward guidance” to let markets and the general public know what the central bank planned to do in the near future.

“If markets rely materially on the Fed’s guidance and the Fed relies on market prices, we are all more likely to be blinded to new developments, more likely to be caught unprepared for a turn of events, and more likely to commit errors in policymaking,” Warsh said.