The last time Kevin Warsh gave a major public address was July 29, after the Federal Open Market Committee (FOMC) held interest rates steady for the fifth consecutive meeting.

The bond market responded loudly in its aftermath, sending longer-dated Treasury yields sharply higher after the Federal Reserve chairman failed to adequately reconcile his tough talk on inflation with the central bank’s rate inaction.

Now, the script is flipped, with the bond market doing its fair share of talking prior to Warsh’s highly anticipated speech in Jackson Hole, Wyo., on Friday.

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Last week, a bond buyback plan announced by Treasury Secretary Scott Bessent briefly calmed a bond market sell-off stemming from traders reacting to surging oil prices and the U.S. debt burden reaching a staggering $40 trillion. But Treasury yields rose again the next day, signaling bond market skepticism to the efficacy of Bessent’s strategy.

“Market participants are learning to play the ball, not the referee,” Warsh said following the July FOMC meeting in an effective tagline for his policy of not telegraphing Fed guidance.

But given the recent bond market volatility, will Warsh feel compelled to address the Treasury intervention as it relates to monetary policy? A team of Wells Fargo economists led by Tom Porcelli is skeptical.

“It’s certainly possible Warsh touches on recent developments in the Treasury market and the overlay with monetary policy, or more clearly articulates the committee’s near-term reaction function,” the Wells Fargo economists wrote on Aug. 21. “However, we think the dominant aim of his speech will be to buy the committee time until the [FOMC] task force findings are released, and hope the data cooperates with the current policy stance over the interim.”

Shriya Samarth, head of rates for Europe, the Middle East and Africa at global broker-dealer StoneX Group, called the Jackson Hole speech “an excellent opportunity to reassure the bond markets” during a CNBC appearance Monday.

“This is good opportunity to recalibrate expectations, especially after that loss of credibility in July’s FOMC,” Samarth said. “And this is an opportunity to move us not so much away from forward guidance blindly — for the first time in 18 years, I might add — but also guide us toward that credibility again.”

Fed minutes reveal growing support for rate hike

At the July FOMC meeting, three committee members dissented in favor of a quarter-point rate hike. The meeting minutes, released last week, show increasing support for an interest rate hike to curb inflation.

“Many participants assessed that policy tightening would likely be necessary if inflation did not decline,” the minutes state. “Some participants commented that financial conditions might not currently be sufficiently restrictive to facilitate a return of inflation to 2%.”

In another telling passage, the minutes note that a few participants judged a near-term rate hike would “likely help forestall the need for a steeper and potentially more costly sequence of tightening moves at a later stage.”

Adam Posen, president of the Peterson Institute for International Economics, hopes Warsh uses the Jackson Hole speech to bluntly address the possibility of a Fed rate hike if inflation persists.

“What he should ​say is, ‘I have watched the data, listened to the market as I said I would, listened to the committee, and clearly there is reason to consider a hike in coming months if data does not change,’” Posen told Reuters.

In July, Warsh said he viewed the Jackson Hole speech “like a blank piece of paper right now.” Given the market volatility in the ensuing weeks, it’s possible that page is still blank as Warsh formulates his final read on the shifting economic landscape.