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Dollar steadies as investors await US core PCE and Jackson Hole cues
OCBC analysts say softer energy prices have helped pull US and European yields lower, supporting the dollar without reviving USD debasement fears.
OCBC Bank strategists Sim Moh Siong and Christopher Wong said markets are focusing on upcoming US core inflation data and Federal Reserve guidance, as the US Dollar steadies into fresh catalysts.
They pointed to the US core Personal Consumption Expenditures Price Index as the key event, noting the data may not change the broader view of inflation staying modestly above target but could still keep hawkish Fed risks alive.
The strategists also highlighted that lower energy prices have helped bring down US and European yields, supporting a more benign macro backdrop while not stoking fears about USD debasement.
In FX trading, the article notes GBP/USD has slipped below 1.3650, while EUR/USD holds near 1.1650, as the dollar recovers modestly amid profit-taking and Middle East uncertainty, with Fed Chair Kevin Warsh remarks at the Jackson Hole Symposium also eyed for clues on the interest rate path.
Latest closeEUR/USD 1.157 ▲0.4%|GBP/USD 1.354 ▲0.3%