US dollar is lower pretty much across the board as optimism about the eurozone adds a little risk appetite to the mix. Also not helping the US dollar is the fact that some are wary of what Ben Bernanke will say in Jackson Hole on Friday.
The highlight of this week, even though consumer sentiment data is on the docket, and Case-Shiller news is expected, is going to be Ben Bernanke’s August 31 speech to central bankers gathered in Jackson Hole, Wyoming. Forex traders will be looking for clues about how the US economy is expected to fare in coming months.
On top of that, investors, traders, analysts, and others will be listening for clues about what’s next in terms Fed policy. Are the economic conditions bad enough to warrant more stimulus? If economic data this week is disappointing, it might be just the thing that leads Bernanke to hint heavily that QE3 could be on the way.
More easing in the United States would likely weigh on the dollar, sending it lower, especially against the euro, as adding more money to the system would dilute the currency’s value. It will be an interesting week, with an interesting end.
At 13:23 GMT EUR/USD is up to 1.2566 from the open at 1.2498. GBP/USD is up to 1.5802 from the open at 1.5794. USD/JPY is down to 78.5500 from the open at 78.7430.
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