Dollar Stalls Ahead of PCE Report and Jackson Hole
The US dollar held its ground in a narrow trading range on Wednesday as investors awaited key data releases and the Jackson Hole symposium. Against a basket of six major currencies, the greenback edged up 0.1% to 98.988.
The dollar's stability comes ahead of the July personal consumption expenditures report, the Federal Reserve's preferred inflation gauge, which will be released on Thursday. The Fed meeting in September is also being closely watched, with market participants scaling back expectations for a rate hike to around 40% from about 55% last month.
The Aussie dollar rose 0.3% to $0.7183 after data showed underlying inflation accelerating to 3.6% year-on-year, beating economists' forecasts. The New Zealand dollar fell 0.4% ahead of the Reserve Bank's policy decision on Wednesday next week, where a rate hike is expected.
The Jackson Hole symposium on Friday will be a pivotal event for Fed Chairman Kevin Warsh, who faces a delicate balancing act between defending the Fed's independence and providing clarity on its reaction function without abandoning his preference for less forward guidance.