The dollar index rose above 104 on Friday, hitting its highest levels in eleven weeks and on track to advance for the sixth straight week as investors braced for Federal Reserve Chair Jerome Powell’s Jackson Hole speech for clues on the path for US monetary policy. Analysts are expecting Powell to reiterate the central bank’s stance of keeping interest rates higher for longer to counter inflationary risks, while stressing that policy decisions will be highly dependent on incoming data. Two Fed officials also indicated on Thursday that the jump in bond yields could complement the central bank’s effort to slow the economy and get inflation back to the 2% target, while noting that further rate increases may no longer be needed. The dollar strengthened across the board, with the most pronounced buying activity against the euro and sterling.
