US PCE inflation was softer than expected today and that's weighing on the US dollar. Atlanta Fed President Raphael Bostic said the report makes him lean slightly more to 50 bps in Sept rather than 75 bps and the market is moving in that direction. Fed funds are now at 52% for 75 bps from 60% yesterday.
EUR/USD has fought its way to 1.0032 from partity a short time ago. That's the highest since Monday.
That's part of a broad slump in the US dollar.
The main event today is the speech from the Fed's Powell but it's tough to imagine we'll get a clear signal on September rates. Bostic added that there's still lots of data to come before the Sept 21 decision and Powell is going to want to see more of it before tipping his hand.
Meanwhile, there's clearly a Fed communciation strategy to push a 'higher for longer' scenario where rates are held steady somehwere around 3.75%. The market has already moved in that direction though so it's hardly new.