The U.S. dollar is trading below the 99 level, with long positions in the currency beginning to ease after heavy bullish bets in August. Investors are now turning their attention to the latest inflation data, with the August CPI and PPI reports expected to play a key role ahead of the Federal Reserve’s September meeting.
Fed rate expectations have shifted following recent comments from Fed officials and stronger than expected jobs data. The upcoming inflation readings could determine whether those expectations move again, particularly as policymakers assess the progress being made on inflation.
In global currencies, the euro is edging higher, while the Japanese yen has climbed to its strongest level since February. Canada’s loonie is holding steady despite rising trade tensions with the U.S., as new tariffs worth up to $27 billion on U.S. goods take effect.