The
Federal Reserve Bank of Kansas City’s annual conference in Jackson Hole,
Wyoming is underway. Investors will be watching closely for any clues about what
the US central bank is thinking about the pace of interest rate hikes after
raising its benchmark rate by three-quarters of a percentage point at each of
its last two meetings.

Kansas City Fed President Esther George will be hosting the conference this
year for a final time ahead of her mandatory retirement at age 65. “This year’s
theme discusses constraints as one of the central elements of the current
policy environment. Strong demand and insufficient supply have pushed inflation
up around the world,” she said during her after-dinner remarks on Thursday.

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What is the theme of Jackson Hole Symposium?

Every year since 1978, the Federal Reserve Bank of Kansas City has sponsored a
symposium on an important economic issue facing the US and the world economies.
It is an annual gathering of central bankers, policymakers, and economists from
around the world. Each year it selects a specific topic and a pool of attendees
for the symposium. The theme for this year’s symposium is “Reassessing
Constraints on the Economy and Policy”.
It was first organized in 1978 and the theme was “World Agriculture Trade: The
Potential for Growth,” and back then it was held in Kansas City. In 1982, the
location was changed to Wyoming for the first time, then Fed Chair Paul Volcker
was invited to participate. That was another first for the symposium, with a
Fed chairperson attending the event.

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What is the objective of this symposium? The conference hosts about 120 attendees annually, including central banks,
finance ministers, academics, financial market participants, and economists
from around the world to discuss the economic issues, implications, and policy
options pertaining to the symposium topic. Like with any symposium, papers are
presented, debated over, discussions are held, and speeches are given. The
primary goal of the Economic Policy Symposium when it began was to provide a
platform for promoting public discussion and exchanging ideas. Throughout the
event’s history in Jackson Hole, participants from 70 countries have gathered
to share their diverse perspectives and experiences.

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Why is the Jackson Hole Symposium important?

This year’s conference is the first in-person conference since the
Covid-19 pandemic, while the last two conferences were held virtually. The Jackson Hole Symposium also comes on the back of a record high
inflation and concerns over the US economy slipping into recession. In an
attempt to curb inflation, the US central bank has raised interest rates by
2.25% since the start of 2022, including two consecutive 0.75% hikes.
In recent years, the conference has come into focus for the guidance provided
by the US Fed. The Fed Chair’s speech will be closely watched for it may
signal the Fed’s future course of action.