The dollar hit a three-week low against the yen on Monday but stabilised against other currencies as investors considered the possibility of the Federal Reserve beginning a series of interest rate cuts. The dollar dropped to 143.45 yen, its lowest since Aug. 5, before recovering slightly. Meanwhile, it strengthened against the euro and sterling after reaching multi-month lows on Friday following Fed Chair Jerome Powell's comments suggesting imminent rate cuts. Traders were closely monitoring the impact of rising tensions in the Middle East, which caused oil prices to surge by nearly three per cent. Federal Reserve Chair, Jerome Powell's, speech at the annual economic conference in Jackson Hole, Wyoming, was highly anticipated. Powell stated that it was time for policy adjustments, leading traders to solidify expectations of a 25-basis point rate cut in September and even consider the possibility of a larger 50 bps rate cut. Samy Chaar, chief economist at Lombard Odier in Geneva, noted that Powell's remarks confirmed market expectations of a rate cut and a shift in focus from inflation to the labour market. The dollar index, which gauges the currency against six major peers, rose slightly to 100.82 from a 13-month low of 100.60 last week. Trading was anticipated to be quieter due to a public holiday in the UK. Attribution: Reuters
