Investing.com -- Federal Reserve Chairman Kevin Warsh told Congress on Tuesday that the central bank has "no tolerance" for persistently high inflation and remains committed to restoring price stability.

In his first testimony before the House Financial Services Committee, Warsh said the Fed’s primary objective is to end the inflation surge that has affected the U.S. economy over the past five years.

"The members of our Committee have no tolerance for persistently elevated inflation. And we share a resolute commitment to restoring price stability," Warsh said in his prepared remarks.

The Federal Open Market Committee held its target range for the federal funds rate at 3-1/2 to 3-3/4 percent at its June meeting, according to the testimony.

Warsh described the economy as expanding at a solid pace, with household consumption growth remaining moderate and manufacturing output moving up steadily this year. The housing sector continues to lag, he noted.

Business investment stands out as the most striking feature of the current economy, driven largely by data center construction and demand for AI-related equipment and software. Investment in equipment overall increased about 8 percent for the year ending in the first quarter, while high-tech spending grew nearly 25 percent on a four-quarter basis.

"We don’t know the extent to which the economy will benefit from the AI buildout. Yet it seems inevitable that what is now called ’AI investment’ will soon be called just ’investment,’" Warsh said.

The labor market appears broadly stable, with job creation keeping pace with the workforce and the unemployment rate remaining low with little change over the past year.

Warsh announced the creation of five task forces to review key aspects of monetary policy, including Fed communications, balance sheet policies, data sources, productivity impacts from new technologies, and inflation frameworks.

"We are starting a new chapter at the Federal Reserve at a consequential time for our nation," Warsh said.