The dollar clung to modest gains against the euro and sterling on Friday, ahead of Federal Reserve Chair Jerome Powell‘s eagerly awaited speech, which traders believe would provide hints on the US central bank’s tightening intentions.

Also Read| Aaron Donald swings 2 helmets in Rams Bengals fight in joint practice: Watch

The euro was trading at $0.9966 in early Asian trade, having failed to push back over parity against the dollar numerous times this week.

The sterling was down 0.17% at $1.1818. A staggering increase in the cap on energy prices will be announced by Britain’s energy regulator later in the day, adding to inflation in the country’s already fragile economy.

Also Read| Henderson, Kentucky homeless shelter shooting leaves 2 dead, many injured

The dollar index, which measures the currency against its six major counterparts, is now at 108.53, on course for a 0.38% weekly gain and up 2.5% in August.

The Jackson Hole symposium address by Powell will be closely watched by investors for any indication of how quickly the U.S. central bank still intends to hike interest rates.

Also Read| Steven Hoffenberg-Jeffrey Epstein relationship explained

The Fed has already increased rates four times this year in its attempts to combat rising inflation, with the majority of them being larger than average hikes, and investors want to know how it plans to boost rates in the future. Powell will start speaking at 10 a.m. Eastern time on Friday, a half-hour after Wall Street opens for trade.

Also Read| US Stock Market: DJIA, S&P500, Nasdaq and Russell ended in green on Thursday

Neel Kashkari, president of the Minneapolis Federal Reserve Bank, stated on Tuesday that his greatest concern is that the U.S. central bank would misjudge the scope and persistence of price pressures and will need to implement even more aggressive rate rises in order to combat inflation.

Also Read| Ashley Biden diary theft: Why internet is calling Joe Biden a paedophile

On the assumption that policymakers would be more concerned about the slowing economy than rising inflation by then, markets are now set up for U.S. rate rises to peak this year and are pricing in rate cuts in 2023.

Also Read| Police believe person found dead was Jeffrey Epstein mentor Steven Hoffenberg

The Australian dollar declined 0.35%, returning to the psychological threshold of $0.7, but continuing to rise against fallen European currencies. The Japanese yen fell slightly to 136.64 per dollar. Indian Rupee rises 6 paise to 79.86 against US dollar in early trade.