By Shant Movsesian and Rajan Dhall MSTA
Coming off a mixed week for the USD, traders focus their attention on the Jackson Hole symposium which starts on Thursday, running through to Saturday. Within this, Friday’s address by the Fed chair will take centre stage, and for all the ‘will she, won’t she’ talk about monetary policy, the market will be hanging on Janet Yellen’s words, as the third rate hike for 2017 remains in the balance. As it stands, ECB sources (always an interesting one that) report that president Draghi will refrain from covering policy matters when he takes to the stand, and we saw this hit the EUR, helping to stabilise the USD index in the process.
Since then, political shenanigans at the White House have again undermined the greenback, with the past week see the manufacturing council disbanded by Donald Trump after a series of resignations prompted by his public address in response to the Charlottesville attack. We then saw rumours hitting social media that Gary Cohn had resigned, but despite being dismissed, cast doubt over the chief economic adviser’s advocacy of the current administration.
Ending the week we saw chief strategist Stephen Bannon removed (in whatever manner this entailed), and through all the above, risk sentiment wobbled (at best) again, and the funding currencies and safe havens led by the JPY and CHF regaining ground. Gold also pushed above $1300, but failed to maintain this key level into the weekend.
This post was published at Zero Hedge on Aug 20, 2017.
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