Friday August 22, 2014 - 00:21:38 GMT
Share This Story
Reuters - www.reuters.com
FOREX-Dollar rally cools as Jackson Hole takes centre stage
* Dollar rally loses steam as investors eye Yellen's speech
* Yellen could counter hawkish tone in Fed minutes
* ECB Draghi also due to speak at Jackson Hole
By Ian Chua
SYDNEY, Aug 22 (Reuters) - The dollar hovered just below its 2014 peak against a basket of major currencies early on Friday, with bulls turning cautious ahead of a speech by Federal Reserve Chair Janet Yellen.
The dollar index, which ended the New York session lower for the first time this week, traded at 82.154, off a high of 82.364 - a level last seen in early September.
It was still up 0.9 percent so far this week and on track to post its best weekly gain since late January. Upbeat housing data and a hawkish-sounding Fed minutes have combined to give the greenback a big boost.
This week's rally left the dollar on the verge of breaking above its April peak of 104.13 yen, a move that could open up the way to 105.45 set in January. It was last at 103.85 yen, not far from the overnight peak of 103.97.
The euro fetched $1.3282, having bounced off an 11-month trough of $1.3242, aided in part by a survey that showed Germany's private sector grew for a 16th month running in August.
Other currencies were also off their lows including the Australian dollar, which popped back above 93 U.S. cents from a 2-1/2 month low of $0.9235.
Traders said the risk to dollar bulls now is Yellen herself.
"After the hawkish bias to FOMC minutes, the dovish camp gets its chance to sound off at Jackson Hole," said Kit Juckes, strategist at Societe Generale.
Yellen is due to give a speech at the annual gathering of central bankers in Jackson Hole, Wyoming. The topic of this year's symposium is "Re-Evaluating Labor Market Dynamics".
Last month, Yellen stressed there was significant underutilization of labour resources, prompting markets to push back the timing of the first interest rate hike.
Highlighting the lively debate between Fed members on when to tighten, Kansas City Fed President Esther George told CNBC on Thursday the time has come for higher rates.
Her more middle-of-the-line colleague, San Francisco Fed President John Williams said the bank should wait until the summer of next year.
Sterling was a notable underperformer on Thursday, held back by disappointing domestic data that suggested Britain's consumer-led recovery might be starting to slow.
Retail sales grew in July at the slowest annual rate since November.
Sterling plumbed a four-month trough of $1.6564 and was last struggling at $1.6578.
Asia is looking at the prospect of an uneventful session given an absence of any major economic data. That should leave the focus squarely on Jackson Hole, where European Central Bank President Mario Draghi will also be giving a speech. (Editing by Shri Navaratnam)
© Thomson Reuters 2014. All rights reserved.
Forex Trading News
Daily Forex Market News
Forex news reports can be found on the forex research
headlines page below. Here you will find real-time forex market news reports
provided by respected contributors of currency trading information. Daily forex
market news, weekly forex research and monthly forex news features can be found
Real-time forex market news reports and features providing
other currency trading information can be accessed by clicking on any of the
headlines below. At the top of the forex blog page you will find the latest
forex trading information. Scroll down the page if you are looking for less
recent currency trading information. Scroll to the bottom of fx blog headlines
and click on the link for past reports on forex. Currency world news reports
from previous years can be found on the left sidebar under "FX Archives."