Falling Dollar Leaves Investors Digesting Powell’s Speech

Following Jerome Powell’s dovish speech on bond cutting at the Jackson Hole conference on Friday, the Greenback was found trading lower on Monday morning in Asia.

According to the U.S. Dollar Index buck was down by 0.06% to 92.640 at 12:01 AM ET.

The speech has impacted dollar pairs such as USDJPY, where the pair declined 0.06% to 109.76 as well as the Aussie, which was trading down by 0.10 % to 0.7303 and Kiwi dipped by 0.08% to 0.6999. 

Only the GBPUSD pair has risen up 0.04% to 1.3769.

Powell stated that the Fed is likely to begin reducing stimulus measures before the end of 2021, but did not provide a date. 

He commented, "It could be appropriate to start reducing the pace of asset purchases this year [...] The timing and pace of the coming reduction in asset purchases will not be intended to carry a direct signal regarding the timing of interest rate liftoff, for which we have articulated a different and substantially more stringent test”.

All eyes are on the NFP due on Friday for clues on when the asset tapering would begin.

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