Warsh's Hawkish Tone Boosts Hike Expectations Ahead of NFP

Warsh strikes hawkish tone ahead of Friday's NFP

The US jobs report on Friday will be closely watched, as economists expect nonfarm payrolls to increase by 65k and unemployment to remain at 4.1%. Federal Reserve Chairman Kevin Warsh delivered a speech in Jackson Hole, emphasizing that bringing down inflation is still the top priority for the Fed.

Warsh's remarks marked a step away from his July press conference tone, where he emphasized markets' role in determining the direction of rates. This suggests that the Fed may be open to hiking interest rates at the next meeting, which has now been priced as nearly a coin-flip.