Warsh's Jackson Hole Address Triggers Market Caution Over Persistent Inflation

Global markets traded cautiously on Friday as investors awaited Federal Reserve Chair Kevin Warsh's first Jackson Hole address. The speech was scheduled for August 28 at the annual Economic Policy Symposium in Jackson Hole, Wyoming.

The latest US data showed that personal consumption expenditures (PCE) price index rose 3.7% in July from a year earlier, while core PCE increased 3.3%. This leaves inflation materially above the Federal Reserve's 2% objective, putting pressure on markets to assess the possibility of a September rate move.

Warsh's address comes as markets seek clearer signals on how the Fed will respond to inflation that remains above target. The market focus is therefore monetary policy because the Fed's latest data show inflation has not returned to its 2% objective.