US Dollar: In Consolidation Mode Until Friday

[DailyFx]

The US Dollar was generally stronger across the majors on Wednesday, though economic data had little to do with the gains and the currency continues to simply consolidate.



Though there are US indicators scheduled for release on Thursday (Philly Fed, leading indicators), neither tends to be incredibly market-moving and as a result, the US dollar may not make any major directional moves until Friday. Why Friday? One word: Bernanke. On Friday at 10:00 EDT, Federal Reserve Chairman Ben Bernanke will speak on financial stability at the Kansas City Fed’s annual symposium in Jackson Hole, WY. His commentary tends to ignite major volatility for not only the greenback, but also for US Treasury and equity markets (and thus, the Japanese yen crosses). Given the uncertainty surrounding the health of US financial institutions, commentary on the financial markets will be watched closely and bearish sentiment by Mr. Bernanke could weigh heavily on risk-appetite. On the other hand, if Mr. Bernanke signals optimism that the US economy and financial sector can weather the storm, the US Dollar and risky assets, in general, could gain.