On Thursday, August 27th, the interest rate market entered a highly sensitive window ahead of the Jackson Hole Economic Symposium. Federal Reserve Chairman Kevin Warsh will deliver a keynote speech on August 28th, his first systematic exposition of policy stance at this important central bank conference since taking office in May. Market data shows the US dollar index is currently trading around 99.20, having risen approximately 0.3% this week. As of August 26th, the yield on the 10-year US Treasury note was 4.37%, and the 30-year yield was 4.66%, indicating that long-term interest rates remain at relatively high levels. The market's current focus is not just on the next interest rate adjustment, but on whether Warsh can re-establish a policy response function that can be understood and priced by the financial markets. Warsh's first constraint comes from inflation. The US Personal Consumption Expenditures (PCE) price index rose 0.2% month-on-month and 3.7% year-on-year in July, while the core PCE price index rose 3.3% year-on-year. During the same period, the Consumer Price Index (CPI) rose 3.4% year-on-year, and the core CPI rose 2.5% year-on-year. This means that although different inflation indicators show some divergence, the PCE price indicator, which the Fed primarily refers to, remains significantly above the 2% target. More noteworthy is the structure of inflation. Energy prices rose 14.7% year-on-year in July, with gasoline prices rising 24.6% year-on-year, indicating that supply disruptions continue to significantly impact overall price levels. Meanwhile, personal consumption expenditure data showed that service consumption increased by $86.2 billion in July, while goods consumption decreased by $49.9 billion. The resilience of service demand means policymakers cannot simply attribute all current inflation to energy shocks. Therefore, the key to Jackson Hole's speech was not whether Warsh reiterated the "2% target," but how he distinguished between short-term supply shocks and potentially persistent price pressures. If this criterion remains unclear, the market will struggle to assess the Fed's sensitivity to future data changes. The labor market is no longer providing one-way policy signals. US non-farm payrolls fell by 23,000 in July, with the average monthly increase over the past 12 months at only 34,000, and the combined figures for May and June revised down by 103,000; however, the unemployment rate remained at 4.1%, without a significant slowdown. In other words, job growth has weakened significantly, but the labor market as a whole has not yet experienced a typical recessionary deterioration. This is precisely the most challenging aspect of current monetary policy. If only job flows are observed, the policy constraints appear to have had an effect; if inflation levels are observed, the Fed lacks the space to quickly ease financial conditions. The July meeting thus saw significant disagreement. The Fed voted 9-3 to maintain the target range for the federal funds rate at 3.50% to 3.75%, while three dissenters advocated for a 25 basis point rate hike. This is not a marginal internal debate, but rather signifies a substantial divergence in the Committee's assessment of inflation persistence, potential economic growth, and the current constraints on real interest rates. As of August 26, the yields on 2-year, 10-year, and 30-year US Treasury bonds were approximately 4.02%, 4.37%, and 4.66%, respectively. There is no simple policy rate mapping between the short and long ends, meaning that term premiums, fiscal financing needs, inflation risk compensation, and institutional credibility are all contributing to bond pricing. This also explains why the impact of Warsh's speech on gold and the dollar cannot be understood solely through the "rate hike or rate cut" scenario. The market still considers the probability of at least a 25 basis point rate hike before December to be around 72%; different assets are actually simultaneously weighing real interest rates, term premiums, inflation risk, and policy credibility, rather than trading around a single interest rate expectation. From a technical perspective, it is more worthwhile to observe whether yields across different maturities change synchronously after the speech, and whether the correlation between gold, the dollar, and real interest rates recovers. If short-term rates primarily respond to policy expectations while long-term rates continue to fluctuate independently, it means the core of the market debate remains on long-term inflation compensation and the policy framework, rather than the interest rate adjustments at a single meeting. Warsh had previously stated clearly that there is no so-called "easing version" of the 2% target and emphasized that the Fed will achieve price stability. However, the main controversy surrounding his July press conference did not stem from the policy outcome, but from insufficient explanation. Warsh's weakening of traditional forward guidance, hoping to reduce the market's reliance on commitments to the future path, has a logical basis; the problem is that reducing future commitments does not equate to reducing explanations of the basis for current decisions. Currently, the Fed has established five policy working groups to study communication mechanisms, balance sheet policy, data sources, productivity and employment, and the inflation framework. Warsh recently stated clearly that this work aims to re-examine the core mechanisms of monetary policy. The final framework will obviously not be finalized in a single Jackson Hole speech; therefore, the market's more realistic demand is for a temporary but clear decision-making logic. Three truly important questions remain: what kind of inflation changes will alter policy judgments, to what extent the labor market deteriorates will increase the weight of employment, and whether changes in long-term interest rates will, in turn, affect policy assessments. If Warsh can answer any part of these questions, the information value of his speech may be greater than simply discussing the next interest rate move.