Home Daily Commentaries USD rally eases ahead of Jackson Hole

USD rally eases ahead of Jackson Hole

Daily Currency Update

The US dollar was little changed on Thursday morning ahead of US Federal Reserve officials gathering at the annual Jackson Hole Economic Symposium. 

US real gross domestic product (GDP) decreased at an annual rate of 0.6% in Q2 2022, according to preliminary data by the US Department of Commerce. This contraction was at a more moderate pace than initially thought, which may have been the reason for USD holding steady this morning.

A surge in global rates on the heels of rising inflation expectations has helped underpin recent USD gains, driving the US Dollar Index (DXY) higher as the euro, GBP, and JPY all fell.

The US Dollar Index was trading at 108.59 at the time of writing. 

Key Movers

EURUSD retreated again on Thursday morning, even after Germany – the Eurozone’s biggest economy – reported that Q2 GDP increased by 1.7% annually, which was higher than economist expectations of 1.4%. EURUSD was trading at 0.99749 at the time of writing. 

The Bank of England could be forced to reassess the pace of their rate hikes due to surging gas prices. Markets are currently pricing in a total of 170 basis points of interest rate hikes by year-end in an effort to curb soaring inflation. GBPUSD was trading at 1.1815 at the time of writing.

Expected Ranges

  • EUR/USD: 0.9929 - 1.002 ▲
  • GBP/USD: 1.178 - 1.1859 ▲
  • AUD/USD: 0.6893 - 0.699 ▲
  • USD/CAD: 1.2899 - 1.2998 ▼