Dollar Soars to Two-Week High as Warsh Hints at Rate Hike
The US dollar strengthened to a two-week high on Monday after Federal Reserve Chair Kevin Warsh hinted at a possible rate hike in September. Warsh's comments, made during his speech at Jackson Hole, suggested that policymakers may need 'work to do' if inflation doesn't move towards the 2% target.
The dollar index, which measures the US currency against six major peers, held steady near 99.6 after jumping 0.6% on Friday to its strongest level since August 17. The yen slipped past the critical 160-per-dollar level, prompting renewed discussion of possible intervention by Tokyo authorities.
Brent oil prices rose nearly 2% after US forces struck Iran's Larak Island on Sunday, adding to dollar demand in the markets. Markets are now turning their focus to incoming US data, particularly Friday's nonfarm payrolls report and next week's consumer inflation figures.