Dollar Cautious Ahead of Key Data and Warsh Speech

US dollar markets remain cautious ahead of key data releases and speeches from influential figures. According to ING strategist Francesco Pesole, recent US Personal Consumption Expenditures (PCE) Price Index data shows disinflation is on track but at a slow pace.

The PCE index printed in line with expectations at 0.2% month-on-month and 3.3% year-on-year. However, headline PCE came in slightly firmer at 0.2% MoM and 3.7% YoY, leading to a small hawkish repricing in the USD curve.

Pesole still expects the Federal Reserve (Fed) to hold rates on September 16, anticipating a weaker Dollar. However, he warns that hawkish market pricing and Kevin Warsh's upcoming speech at Jackson Hole could lift hike odds and support DXY near 99.0.