TD Securities expects Kevin Warsh’s speech to drive dollar moves based on inflation credibility rather than rate guidance.
Kevin Warsh’s upcoming Jackson Hole speech is expected to emphasize structural themes like productivity, AI-driven growth, and Federal Reserve reforms, according to strategists. This focus may leave rate expectations anchored, limiting sustained dollar direction but increasing volatility.
Markets are likely to parse the speech for clues on inflation credibility, with USD risks tilted modestly downward. A lack of hawkish reaffirmation could weigh more on the dollar than any supportive signals provide.
The event is seen generating more volatility than trend, as traders search for policy signals that may not materialize. Without clear messaging on inflation, the dollar may struggle to establish a firm direction.