US Treasury secretary Scott Bessent's surprise decision to at least double long-term debt purchases is pulling in the opposite direction of the Federal Reserve's inflation fight, big investors warn ahead of Kevin Warsh's Jackson Hole speech.

Wall Street criticized Bessent's bond market intervention, saying it could undermine the Treasury's credibility and complicate the Fed's efforts to tame this year's inflation flare-up. The move has raised stakes for Warsh, who will address the Kansas City Fed's economic conference in Jackson Hole, Wyoming, on Friday.

Both Bessent and Warsh are protégés of hedge fund billionaire Stanley Druckenmiller and maintain cordial relations, but investors note their institutions' priorities are increasingly at odds.

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