Trading in the U.S. Treasury market could get jumpy next week as investors scrutinize remarks from Federal Reserve officials for clues on their outlook for the economy and the timing of any moves to scale back the bank’s accommodative monetary policy.

The week ahead is low on top-tier economic data, and absent any Treasury-debt auctions, market participants will be left to zero in on the multiple Fed speakers on tap.

Several top officials, including New York Fed President William Dudley and Fed Vice Chairman Donald Kohn, will speak in Chatham, Mass., at the Boston Fed’s annual conference, which will also feature Boston Fed President Eric Rosengren.

Fed Chairman Ben Bernanke speaks twice next week, in San Francisco Monday and at the Boston Fed conference Friday.

Chicago Fed President Charles Evans and Atlanta Fed President Dennis Lockhart, both voting members of the Fed’s policy-setting committee this year, will also speak in Chicago and Florida, respectively.

Chatter about when the Fed will pull its support from markets has intensified this month following word that the central bank has been testing one tool it could use to help remove cash from the system when the time is right – reverse repurchase agreements. The central bank also continues to hold talks with individual dealers about the operational details of such transactions.

Few see these tests as an indication that the actual implementation of exit strategies is imminent. For the most part, market participants don’t expect the Fed to carry out any large-scale reverse repos until 2010, with interest-rate hikes later next year.

But evidence of a stronger-than-expected recovery could upend that view, forcing the Fed to act sooner and with greater force than currently anticipated. Some central bank officials have suggested as much, particularly Fed Governor Kevin Warsh, who said in an opinion article in the Wall Street Journal that when rates do start rising, increases could be more aggressive than many now anticipate. The top-tier officials – Bernanke, Dudley and Kohn – however, have stressed that interest rates will remain low for a while.

“Over recent weeks, there have definitely been two camps developing within the Fed,” said Tom Porcelli, economist at RBC Capital Markets in New York. “The debate is healthy, and it should take place,” Porcelli said, “but it does lead to some confusion in the market. It’s a very tricky environment.”

Porcelli’s fear is that the divergence between the two camps will only grow, and that could make for some very volatile trading in the government-bond market.

But RBC is sticking to its call that Treasury rates should continue to fall heading into year end as the economic recovery remains muted and inflation tame. The bank is looking for opportunities to make bets on a flatter yield curve, or a shrinking gap between the two- and 10-year yields. RBC sees the 10-year yield falling to 3% by year end from its current 3.43%, with short-end Treasury rates hovering around their current levels of 1%.

Rick Klingman, managing director of trading at BNP Paribas in New York, also sees curve-flattening trades regaining popularity in the Treasury market, but for the opposite reason: both short-and long-term yields will rise as the economy continues to recover, with shorter-dated yields rising faster.

“Waiting for [flattening] has been a painful and unsuccessful process so far,” said Klingman, who expects trade to remain volatile until there is more clarity on the economic front.

Late Friday, Treasurys benchmark yield curve was at 246 basis points, slightly steeper than a week ago when it stood at 241 basis points.

(Deborah Lynn Blumberg writes about the Treasury markets and other fixed-income markets for Dow Jones Newswires. She can be reached at 212-416-2206 or deborah.blumberg@dowjones.com.)

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