🔥Jackson Hole debut sets the tone: Inflation is still the “number one enemy,” and the odds of a rate hike in September jump to 60%!
#沃什称通胀是美联储首要关注
On August 28, Fed Chair Worsh delivered his first keynote speech since taking office at the Jackson Hole Global Central Banking Conference, sending a clear hawkish signal. He stated plainly that inflation remains the Fed’s top priority for monetary policy.
📊 Let the data speak: Why is inflation still the top concern?
Worsh went straight to the pain point with the numbers—PCE year-over-year at 3.7%, and the annualized rate over the past six months at 4.1%, both well above the 2% target. Within the PCE basket, about half of the categories have seen gains exceeding 3%. Although this summer’s inflation data came in better than expected, Worsh said, “These data do not tell me that the underlying inflation trend has shown a substantial improvement.”
He went further: “We must be confident that underlying inflation is moving clearly toward our goal, at a pace that is sufficiently fast. Otherwise, we still have work to do.”
💪 Where does the confidence come from? The economy is holding up, so no panic on hikes
In Worsh’s view, the U.S. economy “seems to be gaining strength.” Corporate profit margins are elevated, credit spreads have narrowed, and the labor market is stable (unemployment rate at 4.1%). Financial conditions are hard to characterize as having clear constraining effects. The resilience of both the economy and employment gives the Fed room to keep interest rates high—and tighten policy further if necessary.
🤫 A different kind of Worsh: No guidance—just a “quieter” approach
Unlike his predecessors, Worsh refused to provide any commitment to a path for interest rates: “Standing here today, what I’m committing to is discipline, not a particular decision.” He advocates building a “quieter” central bank with more purposeful communication, and opposes having markets “staring at the Fed, looking for the next move.”
📉 How will markets react? Rate-hike odds surge, risk assets
Near term: With the hawkish tone set, before the September FOMC meeting, markets will likely continue to battle over inflation data.
Long term: Worsh’s governance approach of “data dependence + stepping back from forward guidance” suggests that uncertainty around each future decision will be higher, and market volatility could intensify.
Iron friends—do you think the Fed will really raise rates in September?
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#沃什称通胀是美联储首要关注
On August 28, Fed Chair Worsh delivered his first keynote speech since taking office at the Jackson Hole Global Central Banking Conference, sending a clear hawkish signal. He stated plainly that inflation remains the Fed’s top priority for monetary policy.
📊 Let the data speak: Why is inflation still the top concern?
Worsh went straight to the pain point with the numbers—PCE year-over-year at 3.7%, and the annualized rate over the past six months at 4.1%, both well above the 2% target. Within the PCE basket, about half of the categories have seen gains exceeding 3%. Although this summer’s inflation data came in better than expected, Worsh said, “These data do not tell me that the underlying inflation trend has shown a substantial improvement.”
He went further: “We must be confident that underlying inflation is moving clearly toward our goal, at a pace that is sufficiently fast. Otherwise, we still have work to do.”
💪 Where does the confidence come from? The economy is holding up, so no panic on hikes
In Worsh’s view, the U.S. economy “seems to be gaining strength.” Corporate profit margins are elevated, credit spreads have narrowed, and the labor market is stable (unemployment rate at 4.1%). Financial conditions are hard to characterize as having clear constraining effects. The resilience of both the economy and employment gives the Fed room to keep interest rates high—and tighten policy further if necessary.
🤫 A different kind of Worsh: No guidance—just a “quieter” approach
Unlike his predecessors, Worsh refused to provide any commitment to a path for interest rates: “Standing here today, what I’m committing to is discipline, not a particular decision.” He advocates building a “quieter” central bank with more purposeful communication, and opposes having markets “staring at the Fed, looking for the next move.”
📉 How will markets react? Rate-hike odds surge, risk assets
Near term: With the hawkish tone set, before the September FOMC meeting, markets will likely continue to battle over inflation data.
Long term: Worsh’s governance approach of “data dependence + stepping back from forward guidance” suggests that uncertainty around each future decision will be higher, and market volatility could intensify.
Iron friends—do you think the Fed will really raise rates in September?
$NVDA
$AAPL
$MRVL