Barclays rates strategist says Fed Chair Kevin Warsh may advocate reducing the
Fed’s use of forward guidance, calling it a source of past policy errors. At the
Kansas City Fed annual symposium in Jackson Hole (Aug 27-29) Warsh may offer
views on balance-sheet policy and is expected to emphasize long-term drivers,
notably productivity trends and their impact on potential growth. He is unlikely
to provide near-term policy guidance; markets will seek signals on how the FOMC
plans to return inf to its 2% target and, if inf fails to improve, Warsh is
likely to confirm that further rate hikes remain an option.
