Warsh Flags Modest Inflation Progress as Market Sentiment Shifts

Fed Chair Kevin Warsh stated that progress towards the Fed's 2.0% inflation target remains modest and reiterated price stability as the central bank's primary mandate.

The markets repriced the chances of a September rate hike to above 50%, pushing USD/JPY through 159.50 towards 160.00, although the move stalled below the 50-day EMA with FX intervention risk in view.

The upcoming US Nonfarm Payrolls report this Friday will be the next major market mover, especially with expectations set at a modest rebound of 58k jobs.