(Bloomberg) -- Just three weeks into the job, Federal Reserve Chairman Kevin Warsh is already facing an unusually high-stakes test.

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Inflation is roaring back at the fastest pace in three years. There’s growing dissent among the central bank’s policymakers. And investors have been dumping US Treasury bonds and piling into bets the Fed will need to start raising rates by December, defying President Donald Trump’s call to lower them instead.

There’s little hanging on the outcome of the Fed’s policy meeting itself this week. The bank is widely expected to hold its benchmark rate steady in a range of 3.5% to 3.75% while waiting to see how the Iran war’s energy-price shock ripples through the economy, even given Sunday’s interim agreement to halt the conflict.

But Warsh’s maiden press conference — and the Fed’s post-meeting statement and forecasts — will be scoured for clues on what’s next.

If there’s a convincing message that the Fed is willing to shift back into inflation-fighting mode, Wall Street will likely be reassured about Warsh’s commitment to maintaining the bank’s political independence. Fall short, and it will rattle markets already worried he could jeopardize the Fed’s credibility by giving in to the White House.

“It’s just a very difficult position for him all the way around,” said James Clouse, an economist at the Andersen Institute and former deputy director of the Fed’s division of monetary affairs.

It’s never easy for a new Fed chief and some, like Alan Greenspan or Ben Bernanke, faced significant challenges not all that long after assuming the role.

Yet in Warsh’s case, the immediate conflict between the White House’s priorities and the direction of the economy is particularly fraught. The tension on Wall Street has been increased by questions about Warsh’s views and by a broader outlook complicated by war and an artificial-intelligence investment boom that’s pouring fuel on what’s been a surprisingly resilient economy.

Warsh was a staunch hawk during his term as Fed governor between 2006 and 2011, when the housing-market collapse drove the US into a deep recession.

But in the years since he morphed into a fierce critic of the central bank and last year faulted it for continuing to forecast elevated inflation, saying AI will unleash a “significant disinflationary force” by increasing productivity. Warsh’s silence since being sworn in last month — not atypical of a new chair trying to get his bearings — further complicates the picture.