"We Have Work to Do": Fed Chair Kevin Warsh Expresses Concern Over Inflation in Closely Watched Jackson Hole Speech
Federal Reserve Chair Kevin Warsh signaled a hawkish stance on inflation during the Jackson Hole Economic Symposium, suggesting that further interest rate hikes may be necessary. His comments have increased market expectations for a September rate increase.
Why it matters
Federal Reserve policy decisions directly influence global financial markets, borrowing costs, and economic growth.
Kevin Warsh, chair of the interest-rate-setting Federal Open Market Committee (FOMC), remains unpredictable.
In his highly anticipated speech made at the Jackson Hole Economic Symposium, Warsh returned to his more hawkish signaling, specifically saying, "We must be confident that underlying inflation is moving to our objective, clearly and at sufficient speed. Otherwise, we have work to do."
Warsh's speech instantly brought a potential September rate hike back into play.
Following his speech on Aug. 28, the likelihood of a rate hike in September surged to 57.5%, as of this writing, up from about 35.5% yesterday, according to CME Group's FedWatch tool.
Here's why Warsh is still concerned about inflation .
Prior to Jackson Hole, the market had become more dovish about Warsh and the Fed, following softer inflation reports in June and July and weakness in the July jobs report.
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