Following Fed Chair Warsh's remarks at the Jackson Hole symposium, market reactions, expectations of foreign-exchange intervention and the outlook for US monetary policy will be the focus. Month-end factors and developments surrounding major events will also attract attention.
On Monday, 31 August, developments surrounding the Jackson Hole symposium are expected to be the market's focus, with market reactions to Fed Chair Warsh's remarks and expectations of foreign-exchange intervention likely to shape a mixed market environment. Expectations for US monetary policy are also being closely watched ahead of the September FOMC meeting. Unlike on a typical trading day, no major US economic indicators are scheduled for release today, according to reports.
Today's schedule includes 31 August month-end factors and the UK's closure for a public holiday, both of which could affect market trends at the start of the week. Following the Jackson Hole remarks over the weekend, buying pressure on the dollar could strengthen, while expectations surrounding possible intervention and prospects for higher interest rates will also intersect. Market participants are expected to monitor USD/JPY, EUR/USD and movements in US long-term interest rates.
Month-end factors at the end of August include month-end positioning and the meetings of G7/G20 finance ministers and central bank governors, which could affect policy decisions and market direction from this week onward. USD/JPY was seen rising into the 160 range over the weekend, while EUR/USD was reported to have fallen to the upper 1.15 range. These moves are reportedly linked to expectations regarding the direction of US monetary policy and whether intervention will occur.