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Dollar Trades Cautiously Ahead of Jackson Hole

FOREX

The greenback initially traded well in early NY before prices reversed entirely shortly following the US equity open. This helped buoy most major pairs and most notably GBP. This made GBP one of the strongest performers into the close, despite trading weaker throughout European hours. This narrow's GBP/USD's gap with the bull trigger atthe Aug19 high of 1.3267. A break here opens 2020 highs printed on Jan 1st at 1.3278.

NZD was the best performer Wednesday, with NZD/USD looking to make a more convincing break of the 50-dma at 0.6560, but there are few signs of a full bullish breakout just yet.

Equities traded very strongly, with US markets topping out at another all-time high. The tech sector again traded well, leading the NASDAQ to outperform the other major indices.

Powell's speech at the Jackson Hole policy conference takes centre stage Thursday, with the Fed Chair to deliver his remarks at 1410BST/0910ET. Markets will be watching for any clues on the Fed's policy framework review, which is expected to include a tweak to the Fed's inflation targeting methods.

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