Warsh's Jackson Hole Speech: A Key Test for Interest Rates

Federal Reserve Chair Kevin Warsh is set to deliver his first Jackson Hole speech on Friday. Investors are looking for clues about the direction of U.S. interest rates ahead of the Fed's September meeting.

The market does not expect him to directly say whether rates will be cut or raised in September, but rather how he assesses inflation, economic growth and financial conditions. This could influence whether lower or higher rates are chosen.

According to Bank of America, 69% of fund managers expect Warsh to maintain a neutral stance, meaning any unexpected shift could have a larger impact on markets.