Dollar On The Backfoot Ahead of the Fed

The greenback is the weakest currency in G10 ahead of this evening's Fed meeting, at which markets are expecting little change in overall policy but will look to garner more insight into the Fed's shift to Average Inflation Targeting as disclosed at the Jackson Hole policy symposium. Downside in the USD index has been limited, however, with the DXY still above the week's lows at pixel time.

UK CPI for August came in slightly ahead of expectations (-0.4% vs. Exp. -0.6%), although still hit the lowest reading since 2015 on a Y/Y basis. The government's 'Eat Out to Help Out' scheme put downside pressure on restaurant and cafe prices, but the effect is seen as transitory, leaving GBP largely unmoved.

Better oil prices and generally firm equities are helping NOK, AUD and NZD to the top end of the G10 pile.

US retail sales report for August is due, with analysts seeing a 1% rise in sales on the month, with the Canadian CPI report also due. The Brazilian central bank rate decision crosses, with the SELIC rate seen unchanged at 2.00%.