- Morning Bid: Dollar rockets as Powell trumps AI

Investors are waiting for the Federal Reserve boss’s assessment of long-term interest rates, causing a halt in the late August bloom in world markets. The dollar has surged as a result. Fed Chair Jerome Powell is scheduled to speak at the annual central banking symposium in Jackson Hole, and his speech is expected to differ from European Central Bank President Christine Lagarde’s message later in the day. Business surveys have shown contrasting fortunes between the euro zone and the United States, with the euro/dollar exchange rate dropping to its lowest level in over two months. The dollar’s index has reached its highest point since June 7. The shifting odds of a Fed rate hike have put pressure on Powell to clarify the Fed’s stance. Some of Powell’s colleagues have indicated that the central bank may have done enough on policy rate tightening. U.S. economic numbers remain strong, with jobless claims falling below forecast and core durable goods orders remaining resilient. European stocks have been more positive compared to the dour equity market mood in Asia and the United States. Treasury yields have increased slightly, and oil prices have rebounded. China’s stock market is struggling, and authorities are planning to cut the stamp duty on stock trading to revitalize it. Turkey’s lira has given back some of its gains after a significant interest rate hike. Key events to watch for include Powell’s speech, Lagarde’s speech, the University of Michigan’s consumer survey, and the ASEAN finance ministers and central bank chiefs meeting in Jakarta.