Forex News: U.S. Dollar Drops After Powell's Speech

U.S. Dollar Drops After Powell's Speech

(RTTNews) - The U.S. dollar weakened against its major counterparts in the New York session on Friday, as Federal Reserve Chair Jerome Powell hinted at a potential rate cut next month.

In his speech at the Jackson Hole symposium, Powell said that "the baseline outlook and the shifting balance of risks may warrant adjusting our policy stance."

Powell added that risks to inflation are tilted to the upside and risks to employment to the downside, which is a challenging situation.

"When our goals are in tension like this, our framework calls for us to balance both sides of our dual mandate."

Markets are fully pricing in a rate cut at the next month's monetary policy meeting.

The greenback fell to more than 3-week lows of 1.1742 against the euro and 0.8000 against the franc, from an early more than 2-week high of 1.1582 and a 10-day high of 0.8104, respectively. The next possible support for the currency is seen around 1.19 against the euro and 0.78 against the franc.

The greenback declined to a 4-day low of 1.3544 against the pound and an 8-day low of 146.57 against the yen, from an early fresh 2-week high of 1.3390 and a 3-week high of 148.77, respectively. The currency may find support around 1.38 against the pound and 143.00 against the yen.

The greenback dropped to a 4-day low of 0.6501 against the aussie and a 3-day low of 1.3814 against the loonie, from an early high of 0.6415 and more than a 3-month high of 1.3924, respectively. The currency is seen finding support around 0.66 against the aussie and 1.35 against the loonie.

The greenback weakened to a 2-day low of 0.5876 against the kiwi, from an early 4-1/2-month high of 0.5800. If the currency falls further, it is likely to find support around the 0.60 level.

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