The start of the week saw the focus stay on the post-Jackson Hole reaction but there wasn’t much follow through in the end. The dollar fell after Fed chair Powell’s dovish tilt at the end of last week but recovered in the opening stages this week. That came as markets push the limits of Fed pricing, in moving to expect two rate cuts by year-end.
That before some dollar selling came by again in the past few sessions, resetting dollar sentiment for the most part. But so far today, there isn’t much action with major currencies holding relatively muted.
The changes are light around 0.1% or at most 15 pips for dollar pairs currently, highlighting the lack of appetite to start the session. There should be extension of the ranges in the hours ahead but all eyes will be on price action in the run up to the London fix for any volatility kick.
Otherwise, the final trading day this week might end up being a bit of a dud as traders and investors wait on the non-farm payrolls release to reaffirm Fed rate cut expectations.
The changes for dollar pairs on the week highlight the push and pull and lack of conviction for the most part. That is besides some minor extended action in commodity currencies
