Kevin Warsh is set to deliver his first Jackson Hole speech as Federal Reserve Chair on Friday. Markets remain divided over a potential rate hike in September, with roughly a 38% probability implied by the FedWatch tool. Since taking over in May, Warsh has sought to reduce investors’ dependence on the Fed’s forward guidance, preferring to let economic data and markets shape expectations. The central challenge lies in his ability to restore the institution’s credibility without providing a clear signal on upcoming decisions. Elevated volatility in US Treasury bonds, particularly at the long end of the curve, adds further complexity to his task.
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