By: Editorial Team, StoneX Media
Markets are pricing a 62% chance that the Federal Reserve holds interest rates at its September meeting, and the U.S. dollar is trading well below where that pricing alone would suggest. The Federal Reserve rate path, not the inflation print in isolation, is what currency markets are repricing, with the U.S. dollar index down more than 3% from its yearly high. Core PCE, the preferred inflation gauge of the Federal Reserve, and commentary from the Jackson Hole symposium arrive within days of each other, giving traders two separate chances to reset those odds. That combination is why the U.S. dollar is moving on policy expectations rather than on any single data release.
Michael Boutros is a Senior Market Analyst at StoneX Media who has spent more than two decades trading and analyzing foreign exchange, commodities and equity index markets, with a medium term, event driven approach built around structured multi time frame analysis. He tracks the U.S. dollar alongside the interest rate expectations and inflation data that move it, which is the ground this week's Federal Reserve calendar sits on.
"Still event risk on tap into the close of the week with Powell speaking at the Jackson Hole Economic Symposium", Boutros notes, describing an event that sits outside the normal data calendar entirely. The Jackson Hole symposium matters to the U.S. dollar because it is where the Federal Reserve frames its thinking on the path of interest rates rather than confirming a single month of numbers. Traders, in his words, "will be really focused on his commentary there with regards to what the interest rate outlook looks moving ahead". Consequently, a shift in tone can reprice September odds without a single new data point being released, and the U.S. dollar tends to move first on that repricing. For anyone positioned around the U.S. dollar, that makes central bank language an event risk in its own right.
Core PCE is expected to tick up to 0.2% on a month-on-month basis while the annual rate holds at 3.3%, according to Boutros, who describes it as "the preferred inflationary gauge from the Fed". That distinction matters, because the Federal Reserve weights this measure above headline inflation when it assesses whether price pressures are easing enough to justify lower interest rates. An upside surprise reinforces the case for a hold in September and supports the U.S. dollar, whereas a softer reading pulls the rate path forward and does the opposite. Boutros frames the setup plainly, "so the levels are pretty clear heading into event risk later this week", with the U.S. dollar left to absorb both the data and the commentary that follows it.
Access live prices, supply and demand data and actionable market commentary. Sign up for StoneX Market Intelligence today and receive a 14-day trial.
Sign Up
--- Written by Frédéric Guétin, StoneX Media Producer
--- Expert: Michael Boutros, StoneX Media Senior Market Analyst
The subsidiaries of StoneX Group Inc. provide financial products and services, including, but not limited to, physical commodities, securities, clearing, global payments, risk management, asset management, foreign exchange, and exchange-traded and over-the-counter derivatives. These financial products and services are offered in accordance with the applicable laws in the jurisdictions in which they are provided and are subject to specific terms, conditions, and restrictions contained in the terms of business applicable to each such offering. Not all products and services are available in all countries. The products and services offered by the StoneX Group of companies involve risk of loss and may not be suitable for all investors. Full Disclaimer. This content is not intended for residents of any particular country, and the information herein is not advice nor a recommendation to trade nor does it constitute an offer or solicitation to buy or sell any financial product or service, by any person or entity in any jurisdiction or country where such distribution or use would be contrary to local law or regulation. Please refer to the Regulatory Disclosure section for entity-specific disclosures. No part of this material may be copied, photocopied or duplicated in any form by any means or redistributed without the prior written consent of StoneX Group Inc. The information herein is provided for informational purposes only. This information is provided on an ‘as-is’ basis and may contain statements and opinions of the StoneX Group of companies as well as excerpts and/or information from public sources and third parties and no warranty, whether express or implied, is given as to its completeness or accuracy. Each company within the StoneX Group of companies (on its own behalf and on behalf of its directors, employees and agents) disclaims any and all liability as well as any third-party claim that may arise from the accuracy and/or completeness of the information detailed herein, as well as the use of or reliance on this information by the recipient, any member of its group or any third party.
© 2026 StoneX Group Inc. all rights reserved.
Our subscribers have access to comprehensive market analysis from StoneX spanning commodities, equities, currencies and more.
Federal Reserve rate path expectations have become the dominant driver of the U.S. dollar, with inflation data and central bank commentary landing in the same stretch. Michael Boutros explains why the September decision, not the technical structure alone, is setting the tone for currency markets.
A quiet stretch in currency markets is often mistaken for a turning point, when it is usually a market holding position ahead of the next catalyst. Fawad Razaqzada separates the two, and points to where the pressure is genuinely building.
Japan’s SPPI remains firm near 3% as markets price a September BOJ hike, though softer momentum questions how quickly further tightening may follow.
Our market expertise, advanced platforms, global reach, culture of full transparency and commitment to our clients’ success all set us apart in the financial marketplace.
Reach
With access to 40+ derivatives exchanges, 180+ foreign exchange markets, nearly every global securities marketplace and numerous bi-lateral liquidity venues, StoneX’s digital network and deep relationships can take clients anywhere they want to go.
Transparency
As a publicly traded company meeting the highest standards of regulatory compliance in the markets we serve; our financials and record of accomplishment are matters of public record. StoneX’s commitment to “doing the right thing over the easy thing” sets us apart in the industry and helps us build respect, client trust and new partnerships.
Expertise
From our proprietary Market Intelligence platform, to “boots on the ground” expertise from award-winning traders and professionals, we connect our clients directly to actionable insights they can use to make more informed decisions and achieve their goals in the global markets.
