DB Jackson Hole preview Staying on the summit or trekking a path back to target

Economics Date 21 August 2026 Fed Notes

Jackson Hole preview: Staying on the summit or trekking a path back to target? Matthew Luzzetti, Ph.D. Chief US Economist

Matthew Raskin Introduction Strategist Next Friday at 10am ET, Chair Warsh will provide the keynote address at the Kansas City Fed’s Jackson Hole Symposium. This year’s conference theme is Brett Ryan Senior US Economist “Financial Innovation: Implications for Payments and Policy", but it is unlikely the Chair focuses his comments on this topic. Instead, Warsh noted at the July FOMC meeting that his remarks could go in one of two directions: a “big-picture speech” Justin Weidner or a “more traditional set up for all the action we’re going to have between Economist September and December.” Amy Yang As it often seems to do, this year’s gathering occurs against a challenging policy Economist backdrop for the US central bank. Inflation remains elevated for the sixth consecutive year, and officials have begun to actively debate whether tighter policy is required to bring it back to target. This “good family fight”, in Warsh’s words, resulted in three dissents at the July meeting in favor of a rate hike. In addition, Warsh’s comments during the July presser raised questions about the Committee’s willingness to raise rates in response to persistent inflationary pressures, triggering a rise in longer-term inflation expectations and bond yields.

We discuss the possible features of either approach to this speech.

“Big-picture speech” topics During his short chairmanship so far, Warsh has focused on big picture topics. As such, this approach would be less likely to break new ground on topics that are market relevant over the coming months.

One bigger-picture topic that likely requires some additional elucidation is the Fed's task forces. At this point, our understanding of the task forces is limited to the leaders (see here) and a general description of the topics of focus and timeline for reporting back. However, uncertainty remains about many of the specifics of the task forces: the scope within each topic, how the task forces interact with the FOMC and Fed staff, when specifically they will report their findings / recommendations, and how those conclusions may ultimately be translated into framework or operational changes for the Fed.

Though Warsh noted that he would be “checking with” the task forces between the July meeting and Jackson Hole, it is likely too early for indications about progress being made. For our part, we have written summaries of each of the task forces and recorded podcasts discussing communications and the balance sheet with outside experts. See: (Task force takes: #1 Communications, Task force takes: #2 The balance sheet, Task force takes: #3 AI's impact on productivity and jobs,

Deutsche Bank Securities Inc. IMPORTANT RESEARCH DISCLOSURES AND ANALYST CERTIFICATIONS LOCATED IN APPENDIX 1. UNTIL 19th MARCH 2021 INCOMPLETE DISCLOSURE INFORMATION MAY HAVE BEEN DISPLAYED, PLEASE SEE APPENDIX 1 FOR FURTHER DETAILS.

Task force takes: #4 Fed's inflation frameworks, Task force takes: #5 Alternative data, Podzept: Macro MATTers: A conversation with Patricia Zobel on the Fed's balance sheet, Podzept: Macro MATTers: A conversation with Bill English on Fed communications).

Aside from the task forces, the most obvious topic for a “big picture” speech is AI’s impact on the economy. This is also an area where his comments could have implications for the near-term policy outlook. While Warsh will not want to anticipate the conclusions from this task force, he could outline broadly how he is thinking about the topic.

Warsh has already explicated his views on AI, arguing that, “[A]rtificial intelligence, the latest generation of general-purpose technology, is perhaps as important a change in the economy and business and households that we’ve had in my adult lifetime. It is filled with both a huge opportunity and with risks. I take both of those very seriously.” We would expect some reiteration of this point. Earlier in a WSJ op-ed Warsh took a stronger view on the impact: “AI will be a significant disinflationary force, increasing productivity and bolstering American…