Jackson Hole Fed summit live: Kevin Warsh's keynote speech comes at a pivotal moment for the Federal Reserve

The Kansas City Fed’s annual gathering of central bankers, economists, and academics kicked off on Thursday in Jackson Hole, Wyo. The stakes are high for new Fed Chairman Kevin Warsh — and for markets.

Warsh is scheduled to deliver his first Jackson Hole keynote address on Friday at 10 a.m. ET. It has become tradition for the Fed chair to announce major policy shifts at the summit, which takes place against the mountainous backdrop of Grand Teton National Park.

But this year, it’s anyone’s guess what Warsh will say as he leads a divided Fed.

The central question is whether policymakers should raise interest rates to curb inflation or wait to see whether inflation shocks prove short-lived. On the eve of Warsh’s speech, two Fed officials voiced concerns that inflation is running too hot and that policy is too accommodative.

Warsh’s speech could also skew toward broader trends or more abstract ideas, such as how artificial intelligence is remaking the labor market. So far in his tenure, the Fed chair has dialed back guidance to markets and pushed for reforms to the central bank’s data analysis and communications practices.

Markets are likely to put a great deal of emphasis on Warsh’s words as they remain on edge after a bond sell-off earlier this month. A subsequent Treasury intervention has raised questions about whether the market can tighten financial conditions in place of the Fed. As of Thursday, roughly a third of bond traders expect the Fed to raise rates at its September meeting.