Forex
Home›Forex›Central Banks›Jackson Hole debut for new Fed chair amid bond-market…
Jackson Hole debut for new Fed chair amid bond-market jitters
Investors will look for rate guidance around upcoming July PCE inflation, with core PCE expected at 3.3% year over year.
Action Forex says markets are still assessing how new Fed chair Kevin Warsh will steer policy after taking the role in May, as investors await the Jackson Hole Economic Policy Symposium and question whether he will offer meaningful clues on inflation and interest rates.
The outlet notes Warsh’s first Jackson Hole could be awkward, citing dissent among other Fed officials who may support additional rate hikes if inflation remains above the Fed’s 2.0% target, and the potential market impact of ongoing volatility in Treasury yields.
Action Forex links the backdrop to this week’s Treasury Department intervention in bond markets, which it frames as a sign of concern about a recent rise in long-dated yields. It adds that while Warsh has encouraged market driven higher yields to tighten financial conditions without raising the Fed funds rate, failure to address bond volatility could renew selling pressure in Treasuries.
The week’s macro calendar includes the July PCE inflation release, coming Wednesday before policymakers meet in Wyoming, with core PCE projected to stay at 3.3% year over year and headline PCE expected to hold at 3.7%, while personal income and consumption data will also be watched.