Forecasting the upcoming week: Warsh's Jackson Hole debut and US inflation test a soft US Dollar

The US Dollar Index (DXY) ended the week near even with Thursday, holding near 98.80. Like Thursday, DXY traded down to the 98.50s before recovering later in the session.

The US Dollar Index trades near its lowest since May. The softness owes less to the data than to the plumbing: the US Treasury's move to at least double its buybacks of longer-dated debt pulled yields lower and took the shine off the Greenback, even as Friday's flash Purchasing Managers Index (PMI) surveys showed US activity still accelerating.

Gold surged on Friday to a three-month peak above $4,600, the Australian Dollar climbed to a multi-month high, and Crude Oil held near a four-week high as Middle East tensions simmered.

The coming week is back-loaded. There is little for the Dollar early on, but Wednesday brings the July Personal Consumption Expenditures (PCE) Price Index, the Federal Reserve's (Fed) preferred inflation gauge, and Friday delivers a double-header: new Fed Chair Kevin Warsh's first Jackson Hole keynote and the US Bureau of Labor Statistics' (BLS) preliminary annual benchmark revision to Nonfarm Payrolls. T

he symposium, hosted by the Federal Reserve Bank of Kansas City under the theme "Financial Innovation: Implications for Payments and Policy," takes center stage. With the Dollar already near its lows, any dovish lean from Warsh, or a heavy downward revision to the jobs numbers, could deepen the slide.

Elsewhere, the Eurozone calendar picks up with Germany's IFO survey and the final second-quarter Gross Domestic Product (GDP) reading on Tuesday, the accounts of the European Central Bank's (ECB) latest meeting on Thursday, and flash August Harmonized Index of Consumer Prices (HICP) inflation on Friday, framed by speeches from Cipollone and Schnabel. Japan closes the week with Tokyo Consumer Price Index (CPI) data that feeds the Bank of Japan (BoJ) debate, while Australia is busy with the Reserve Bank of Australia (RBA) minutes on Monday, monthly inflation on Tuesday and second-quarter capital expenditure on Wednesday. Canadian GDP rounds out Friday, and the unresolved Iran standoff hangs over the lot.

EUR/USD ends the week around 1.1680, capped below 1.1700 after another failed run at the figure. The domestic calendar offers little to move it before Friday's flash inflation print, so the pair stays largely a Dollar story keyed to Jackson Hole. A firmer HICP reading would trim the modest easing still priced for the ECB and lend the euro a floor into month-end.

GBP/USD trades in the mid-1.3600s as it closes the week, off midweek highs. With almost nothing on the UK calendar, Cable has no domestic anchor and rides the Dollar and Friday's Jackson Hole address; the risk is a quiet drift until Warsh speaks, then a sharp repricing in either direction.

USD/JPY ends the week just above 159.00, a soft Dollar offset by a yen still weighed down by wide rate differentials. Friday's Tokyo inflation figures are the domestic focus, feeding a BoJ debate where swaps price roughly an 80% chance of a hike at the September 18 meeting. A firm print would harden those bets and press the pair toward its 200-day average.

AUD/USD trades near 0.7170, its best in months and the standout of the majors. The RBA minutes open the week, but Tuesday's monthly CPI is the key test, with headline inflation expected to ease toward 3.2% from 3.8%. A cooler number would pare the little RBA tightening still priced in and could finally test the Aussie's run, while Wednesday's capital-expenditure data offers a read on business investment.

West Texas Intermediate (WTI) Oil ends the week in the high-$80s, near a four-week high, with no oil-specific data due. The crude story stays geopolitical: Washington's pivot toward economic sanctions on Iran rather than further strikes has eased the immediate threat of a supply shock, but reports that talks have stalled keep a floor under prices. Iranian President Masoud Pezeshkian struck a defiant note, saying those who "sit across the border and invite the enemy to invade" are "not Iranians."

Gold ends the week above $4,600, at a three-month peak after a run built on the sliding Dollar, softer real yields and a Middle East safe-haven bid. With no top-tier catalyst of its own, the metal takes its cue from Wednesday's PCE and Friday's Jackson Hole keynote: a dovish read from Warsh would extend the move, while any hint of caution on rates could invite the first real pullback in weeks.