Federal Reserve Chair Kevin Warsh used his Jackson Hole debut to warn that policymakers have "work to do" if inflation does not converge toward the Fed’s fixed 2% target, signaling that interest rates may rise despite President Donald Trump’s preference for lower borrowing costs. Warsh said underlying inflation remains too high, made price stability the priority despite a steady labor market, and said financial conditions are difficult to characterize as restrictive, while declining to provide specific forward guidance and tying decisions to incoming data. Markets lifted the probability of a 25-basis-point or larger hike at the Sept. 15–16 FOMC meeting from about 35% to 57.5%; the dollar-yen pair rose 0.48% to 160.15, the dollar index climbed 0.59% to 99.69, and expectations for a mid-September Bank of Japan rate increase strengthened.