EUR/USD Slumps as US Dollar Gains Strength on Hawkish Fed Expectations

The EUR/USD currency pair is under pressure as the US Dollar gains strength due to increased expectations of a Federal Reserve interest rate hike. The Euro has fallen by 0.2% against the US Dollar, trading at 1.1593.

Fed Chair Kevin Warsh's speech at the Jackson Hole Symposium has been seen as a hawkish tone on inflation, with analysts at Rabobank noting that he 'appeared to rebuild some of his credibility as an inflation fighter.' Warsh emphasized that the Fed still has work to do to bring inflation back to its 2% target.

The US Dollar Index (DXY) is up 0.2% to 99.60, with investors shifting their focus to the upcoming ISM Manufacturing PMI data and JOLTS Job Openings data for August and July respectively.