Dollar Weaker on Thursday
The US Dollar is on watch today as traders brace for the first set of tier-one US data since Powell’s dovish Jackson Hole comments last week. Powell signalled the Fed was on course to begin easing again in light of risks to the jobs market though did express some caution around inflation levels. With that in mind, traders will be closely watching incoming US data ahead of the September meeting, with next Friday’s NFP release set to be a pivotal moment for USD.
US Data Due
Today, traders will be watching prelim GDP and weekly jobless claims. Any weakness in these figures should see easing expectations firming up more, weighing on USD near-term. Any upside surprise should have the opposite impact, dampening easing expectations somewhat and allowing USD to recover. However, unless we see any meaningful upside surprise today it looks unlikely that USD is going to see much upside near-term.
Fed’s Waller to Speak
Looking beyond today’s data, we’ll hear from Fed’s Waller who speaks this evening on monetary policy. Given his dovish leaning his comments are likely to keep USD pressured lower, especially since the July NFP results corroborated his earlier concerns on the jobs market. Against this backdrop, Waller is likely to have turned more dovish. If his remarks follow on from any further data weakness today this could be particularly bearish for USD near-term.
Technical Views
DXY
The Dollar is testing support at the 98 level and bull channel lows. With momentum studies weak, risks of a break lower are seen with 96.89 the level to watch if we do move through this area. Bulls need to break back above 99.15 near-term to alleviate these risks and put focus back on the 100-mark.
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