[Edaily Bang Sung Hoon Reporter] Kevin Warsh, Chairman of the U.S. Federal Reserve (Fed), is set to take the stage at Jackson Hole for the first time since taking office. The market is on tenterhooks, waiting to see if he will finally speak.

According to the Federal Reserve Bank of Kansas City, the Jackson Hole Symposium—an annual economic policy symposium—will be held for three days starting on the 27th (local time) in Jackson Hole, Wyoming. Chair Wash’s keynote speech is scheduled for 8:00 a.m. local time on the 28th, which is 11:00 p.m. on the 28th in Korea. This year’s theme is “Financial Innovation: Implications for Payments and Policy.”

This event is particularly significant because it marks the first time Chair Wash will provide a detailed explanation of his policy vision since taking office last May. Past Fed chairs have used the Jackson Hole forum to outline their monetary policy plans. This presents the market with its first opportunity to gain insight into how the new leader assesses the situation and makes decisions.

The problem is that he has been extremely tight-lipped so far. Shortly after taking office, Chairman Warsh removed the “forward guidance” from the Federal Open Market Committee’s (FOMC) statement at its June meeting. Forward guidance is a set of guidelines that provides advance notice of future interest rate decisions.

He did not provide his own forecast in the “dot plot”—which plots the interest rate projections of individual committee members—and is currently considering eliminating it entirely by the end of the year. His stance is that press conferences should be held only when there is truly significant news.

While the intent is to let the market analyze the data and make its own judgments, the side effects are significant. The Financial Times (FT) pointed out that the Fed’s reduced communication has fueled market distrust, which is driving up long-term Treasury yields.

In fact, warning signs are flashing across the U.S. economy. National debt surpassed $40 trillion (approximately 5,544 trillion won) for the first time in history this month, and yields on 30-year Treasury bonds are fluctuating at their highest levels in 19 years. In addition to volatility in international oil prices caused by the protracted war in the Middle East, the record-breaking flood of corporate bonds issued by Big Tech companies to fund artificial intelligence (AI) investments is also adding to the pressure.

The lack of coordination between the administration and the central bank is another variable. Treasury Secretary Scott Bessent announced on the 19th that he would double the scale of the Treasury bond “buyback” program. However, Federal Reserve Chair Wash, speaking immediately after the FOMC meeting on the 29th of last month, stated that “financial markets are tightening on their own,” suggesting there is no need for the Fed to rush into raising interest rates.

The market is considering two scenarios. Bank of America (BofA) predicts that if Chair Wash clearly signals his determination to curb inflation and his willingness to resume rate hikes if necessary, the market will stabilize; conversely, if he remains tight-lipped, the 30-year yield could test the 5.5% high. The seven-week gap between the July and September FOMC meetings is the longest of the year, and with summer trading volumes typically low, even a single remark could cause significant price volatility.

According to the CME FedWatch tool, the market currently prices in a 61.6% probability that interest rates will remain unchanged at the current 3.50–3.75% range at the FOMC meeting on the 15th and 16th of next month, and a 38.4% probability of a rate hike.

Meanwhile, Bank of Korea Governor Shin Hyun-song and Monetary Policy Committee member Jang Yong-sung will also attend this year’s Jackson Hole symposium. This marks the first time in four years—since former Governor Lee Chang-yong in 2022—that a Bank of Korea governor has attended the event.