Dollar gains before key Powell speech at Jackson Hole on Friday

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September 16-17 meeting after an unexpectedly weak jobs report for July. The risk of higher inflation as President Donald Trump's administration enacts new trade tariffs, however, remains a wild card that is making some policymakers hesitant to ease.The Fed’s Jackson Hole theme this year is “Labor Markets in Transition,” and “I guess it depends on how much (Powell) wants to lean on cracks in the labor market,” said Eric Theoret, FX strategist at Scotiabank in Toronto.“Whether it's the payrolls and the revisions, or whether it's the claims that continue to climb higher, there is a narrative there that he can definitely push on,” Theoret said.The dollar briefly pared gains on Thursday after data showed that the number of Americans filing new applications for jobless benefits rose by the most in about three months last week.It later added to its rally after a separate report showed that U.S. business activity picked up pace in August, led by a resurgent manufacturing sector that featured the strongest growth in orders in 18 months.The dollar index, which measures the greenback against a basket of currencies including the yen and the euro, was last up 0.38% on the day at 98.60, with the euro down 0.34% at $1.1611.The Japanese yen weakened 0.65% against the greenback to 148.29 per dollar. Sterling fell 0.27% to $1.342.Economists at Goldman Sachs expect Powell on Friday to modify his comments from the July Fed meeting, when he said that the U.S. central bank is "well positioned" to wait for more information."Instead, he might note that the FOMC is well positioned to address risks to both sides of its mandate but emphasize that downside risks to the labor market have grown following the July employment report, while reiterating that tariffs are likely to have only a one-time effect on the price level," the economists said in a report."We do not expect him to decisively signal a September cut, but the speech should make it clear to markets that he is likely to support one," they added.Powell is seen as unlikely to clearly signal a rate cut with data for August still due before the September session.Fed funds futures traders pared expectations for a September cut ahead of Powell's speech and are now pricing in 74% odds of a September cut, down from 82% on Wednesday, according to the CME Group's FedWatch Tool. They are also pricing in 49 basis points of cuts by year-end, down from 54 basis points.Terms and Privacy PolicyPrivacy & Cookie SettingsMore InfoS&P 5006,391.18 +21.01 (+0.33%)Dow 3045,069.97 +284.47 (+0.64%)Nasdaq21,113.53 +13.22 (+0.06%)Russell 20002,274.10 +4.74 (+0.21%)VIX16.46 -0.14 (-0.84%)Gold3,369.20 -12.40 (-0.37%)PortfolioSign in to access your portfolioSign inTop gainersXPEV XPeng Inc. 22.75 +2.38 (+11.68%)TLX Telix Pharmaceuticals Limited 12.09 +1.12 (+10.21%)YMM Full Truck Alliance Co. 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