On Tuesday, August 24, the USD regained its posture following Monday’s fall, which is the currency’s sharpest drop since May. The gain happened ahead of the Jackson Hole conference.
The USD Index, which trails the greenback in opposition to its six other rival currencies, inched up 0.10% to 93.065.
An analyst stated that the safe-haven USD could rise more as the central bankers’ symposium approaches.
Several investors are expecting that the Federal Reserve’s conference could halt its asset purchases as well as its stimulus.
Last Monday, the USD suffered as forex traders analyzed their bets on the very important central banker’s meeting.
This annual conference will start on Thursday until Friday, and it will be held online due to the coronavirus pandemic.
On Friday, several economists are expecting the speech of Federal Reserve Chairman Jerome Powell.
Analysts are anticipating that Powell will explain the details and the timetable of the US central bank’s bond-buying program and asset tapering.
Additionally, they are doubting that investors might want to bet on risk assets. Also, they are uncertain if the USD will need to heavily sell-off.
Meanwhile, some economists worry that the Fed will not provide any clue on the symposium regarding its asset tapering plan.
Therefore, this might put heavy pressure on the US currency since it just regained its post alongside tapering anticipations.
This is due to Fed official Robert Kaplan’s hawkish statement last week that the asset tapering might be delayed putting pressure on the greenback.
His reason for this is the surge of the coronavirus delta variant which continues to drag the US economic recovery.
Aside from the Jackson Hole meeting, investors also eye the US housing and manufacturing survey data release later this day.
This is in addition to the gross domestic product data released on Thursday.
Exchange Rates over USD
Furthermore, the NZD/USD smashed 0.75% to 0.0052 as the New Zealand government reassured that the COVID-19 outbreak will not rise any further.
Meanwhile, the expectation of a possible interest rate hike in October fell 40% last Monday.
Another risk-sensitive currency also increased as the AUD/USD pair was up 0.32% to 0.7232.
The same with the safe-haven USD/JPY pair which hopped 0.05% to 109.75.
Likewise, the USD/CHF pair jumped 0.02% to 0.9126 and the GBP/USD pair is flat at 1.3718.
On the other hand, the EUR/USD and the USD/CAD both decreased 0.07% to 1.1736 and 0.14% to 1.2629, respectively.