Jackson Hole Symposium Keeps Fed Hike Risk Alive for US Dollar

The US dollar remains supported by lingering Federal Reserve rate hike risks, according to MUFG analysts. Markets have been pricing in a potential rate cut in September, but MUFG cautions that the Fed may not be ready to commit to easing, especially with inflation still above target.

The Jackson Hole Economic Policy Symposium, scheduled for August 21-23, is expected to be a key catalyst for the greenback. The event often serves as a platform for major policy announcements or signals from central bankers.

As of mid-August 2025, futures markets had priced in roughly a 70% chance of a 25-basis-point rate cut at the September Federal Open Market Committee (FOMC) meeting. However, MUFG argues that the Fed's commitment to its 2% inflation target remains strong, and a premature pivot could reignite price pressures.