New Fed Chair Kevin Warsh Faces Pressure to Clarify Inflation Stance at Jackson Hole

New Federal Reserve Chair Kevin Warsh has brought a sharp change in how the central bank communicates — saying much less than his predecessors about the economy and inflation — and many economists and Wall Street investors haven't been thrilled with that approach, the Associated Press reported. On Friday, Warsh has a high-stakes opportunity to address those concerns when he gives his speech at the Fed's annual economic symposium in Jackson Hole, Wyoming.

What economists and Wall Street analysts are hoping for is a clear signal on how he thinks the Fed should handle the stubbornly elevated inflation that has caused pervasive gloom among many consumers, AP noted. At his last press conference, Warsh sowed confusion by ducking repeated questions on whether the Fed would hike its benchmark interest rate if inflation stays high. His communication style contrasts sharply with predecessors who typically provided more explicit forward guidance. The Fed has been navigating an economy where the US war with Iran has fuelled expectations for hotter inflation as crude oil prices soared. Bond market yields remain steeper than before the conflict began in late February, adding to the challenge facing the new chair. Analysts will be watching Friday's Jackson Hole speech closely for any signals Warsh may offer on the Fed's reaction function to persistent inflation pressures.

**Sources:** Associated Press, kansascityfed.org