U.S. Dollar Rises as Kevin Warsh Signals Rate Hikes
Federal Reserve Chair Kevin Warsh signaled potential interest rate hikes to combat inflation, driving the U.S. dollar toward a two-week high.
The U.S. dollar paused near a two-week high on Monday after Kevin Warsh, Chair of the Federal Reserve, delivered a hawkish inaugural speech at the Jackson Hole symposium. Warsh stated that policymakers still "have work to do" to bring annual inflation back to the 2% target, a move that increased the probability of a rate hike on September 16 to nearly 60%.
Currency strength was further bolstered by rising two-year U.S. Treasury yields and a surge in Brent crude prices, which climbed past $90.50 a barrel. The oil price jump followed U.S. military strikes on Iranian rocket launchers on Larak Island and subsequent retaliatory strikes in Jordan.
Market participants are now monitoring upcoming U.S. economic reports, specifically nonfarm payrolls and the August CPI report, to see if labor market data supports the Federal Reserve's tightening stance.
Keep reading in the app
The full story and every source, free in the app.
Coming soonGoogle Play