USD/CAD Flat as Traders Wait for Clues from Jackson Hole
The USD/CAD pair remained flat around 1.3850 during early European trading hours on Friday, as traders waited for clues from Federal Reserve Chair Kevin Warsh's speech at the Jackson Hole symposium.
Market expectations have shifted with the release of core Personal Consumption Expenditures (PCE) Price Index inflation data, prompting a rise in bets on a September rate increase. The CME FedWatch Tool indicates a 40% chance of a Fed rate hike in September, up from 36% before the data release.
Warsh's speech at Jackson Hole may provide more clarity on his outlook for the US economy, interest rates, and inflation targets. Any hawkish comments could limit Greenback losses in the near term.
Mark Cabana of Bank of America expects Warsh to signal readiness to raise rates again if inflation doesn't moderate.