The dollar rallied yesterday, however it has dropped against the euro and dollar this morning. Its previous strength was due to the release of the FOMC July meeting minutes last night, which were ‘less dovish’ than expected. They revealed that Fed officials view the July rate cut as a ‘recalibration’, rather than part of a ‘pre-set course’ for future cuts. The minutes also stated that given the uncertainty of the risks weighing on the economy, there is a need for the Fed to be flexible and focussed on incoming data.
Further insight into the Fed’s stance will be given at the Jackson Hole meeting, which starts today. Fed Chairmen Jerome Powell will give a speech at 3pm tomorrow, which could affect the dollar’s position.
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