Federal Reserve Chairman Kevin Warsh used his August 28 Jackson Hole keynote, delivered on his 100th day, to present a seven-principle framework for monetary policy rather than provide conventional guidance on the next rate move. The framework emphasizes an unwavering 2% inflation target and short-term interest rates as the Federal Reserve’s main policy instrument. PCE inflation, the Fed’s preferred price gauge, is running at 3.7% year over year and 4.1% on a six-month annualized basis, while about half of PCE components are above 3% on an annualized basis. Unemployment is 4.1%, which Warsh described as consistent with full employment. Business capital expenditure is growing about 9% over four quarters, with more than half linked to artificial intelligence investments. Warsh said he prefers real-time indicators to delayed monthly releases and observed that financial conditions show few signs of policy restraint despite elevated inflation. Markets interpreted the speech as hawkish but moderate, with bond traders pricing elevated odds of a rate increase as early as September, although the outcome remains uncertain under the new framework.