LOOK AHEAD: US Macro Week Ahead: Warsh At Jackson Hole (Friday)

• RES 4: 1.4292 61.8% Retracement Feb’25 - Jan’26 downleg
• RES 3: 1.4264 1.618 proj of the Mar 9 - 31 - May 1 price swing
• RES 2: 1.4248 High Jun 24, 25 and 30 and the bull trigger  
• RES 1: 1.4190 High Jul 9  
• PRICE: 1.4085 @ 21:06 BST Jul 22
• SUP 1: 1.4021/4003 50-day EMA / Low Jul 20
• SUP 2: 1.3981 38.2% retracement of the May 1 - Jun 24 bull cycle  
• SUP 3: 1.3951 Low Jun 15
• SUP 4: 1.3899 50.0% retracement of the May 1 - Jun 24 bull cycle 

The USDCAD trend structure remains bullish and the bear cycle since Jun 24 is considered corrective. Attention is on the next important support at 1.4021, the 50-day EMA. The average has been pierced, however, it remains intact and the latest recovery is encouraging for bulls. A clear break of the EMA would signal scope for a deeper retracement. The bull trigger is at 1.4248, the Jun 24, 25 and 30 high.

Among the four current regional presidential voters, three clearly see a case to tighten. 

• Cleveland's Hammack, one of the most hawkish members of the Committee, told CNBC on the sidelines of the ECB Sintra monetary policy symposium on June 30 that inflation is "too high" and that rate hikes may thus be necessary to tame it - and subsequent comments didn't make her sound soothed by the June inflation data.
• Minneapolis's Kashkari, who has become one of the Committee's bigger policy hawks over the last 6 months, told Bloomberg on June 26 that he included one 2026 rate hike in his June Dot Plot, with no change to rates in 2027.
• Dallas's Logan made it clear in a speech on July 16 that she sees increasing urgency to hike rates, arguing that inflation is not on course to return to 2% sustainably ("I currently believe modestly higher interest rates would better balance the outlook and risks for the FOMC's maximum employment and price stability goals").
• The fourth, Philadelphia's Paulson, has not commented since the June meeting but we assume she eyes a rate hold through year-end and is not an active proponent of hikes. 

Among non-2026 FOMC voters: KC's Schmid didn’t reveal his rate preferences in a July 16 speech, but in a clear nod to rate hikes concluded his remarks "my primary concern is inflation, which is too hot and has been above target for too long. As such, my focus remains on inflation in setting the correct course for policy." He's probably the FOMC's biggest hawk. 

• On the more dovish end of the spectrum, SF's Daly called policy slightly restrictive and said there remained risks to the dual mandate in both directions; there were scenarios in which the Fed could have to fight "more persistent" inflation, and another more dovish scenario in which growth is not sustained.
• More elusive was Chicago's Goolsbee, who commented on July 14 that the June CPI report released earlier in the day was "surprisingly benign", though cautioned that he'd need to see more reports like it to resume "normalizing" rates (i.e., cuts).
• We haven't heard since the last meeting from St Louis's Musalem, Richmond's Barkin, or Boston's Collins, and the Atlanta Fed's presidency remains unfilled.

In other communications (summarized in our PDF): the June FOMC meeting minutes showed some members saw a case for a hike at the time, while debate continued over whether policy is restrictive enough to bring inflation back to target, and whether the next move should ultimately be a hike or a cut.

• And the Fed's July Beige Book depicted more benign economic conditions across the 12 districts compared with the prior report released at the start of June, with upgrades to employment and growth, but slightly tamer selling inflation pressures.

Warsh’s FOMC colleagues were about as communicative as they’ve ever been on their outlook for rates and the economy, however. We recap all the key inter-meeting commentary below. Starting with the permanent voters: traditionally, the Board's leadership has communicated the Chair's current thinking to markets. If that's still the case, a hike looks unlikely to materialize in July. 

• Here we are thinking about NY Fed’s Williams who while noting that the Fed shouldn’t over-emphasize a single soft month of data reiterated that inflation was too high now but was expected to recede in the coming quarters, and that policy "continues to be well-positioned".
• Vice Chair Jefferson also said that interest rates are currently well positioned to deal with a mix of economic shocks from AI to the Iran war, amidst "a delicate balancing act" for the FOMC, and he didn't express urgency to hike rates: "in a scenario where actual inflation does not start to cool down soon, I believe that it could be appropriate to reconsider our current policy stance".
• Those two would effectively have been thought of as speaking on Powell’s behalf under the previous regime, but it's not clear that they are expressing Warsh’s train of thought (aside from clear agreement on downplaying a single month’s data).
• In probably the most important (or at least, market-moving) commentary in the inter-meeting period, Gov Waller in a speech on July 13 came out with a notably more hawkish bias ahead of the June CPI report: "If we get another hot reading on core inflation this week, then the FOMC will need to consider tightening monetary policy in the near term". That saw rate implied July rate hike pricing jump to around 50/50 though of course, June data turned out to be soft.
• Gov Cook on July 15 maintained her wary tone on high inflation and suggested that she could support rate hikes this year. For now, "I see it as prudent to give a bit more time to observe how inflation unfolds from here." But "going forward...I believe the risks continue to be strongly weighted toward higher inflation", and "if we do not see signs of disinflation soon, I am prepared to act."
• The one FOMC member most likely to have put a 2026 cut in her June Dot Plot, Gov Bowman, hasn't spoken on current monetary policy since the June meeting. We also haven't heard from ex-Chair and now Governor Powell, or Governor Barr.