28.08.202608:28:47UTC+00Euro Steady as Investors Await Warsh’s Jackson Hole Speech

The euro held steady around $1.165 as investors digested fresh economic data and looked ahead to Federal Reserve Chair Kevin Warsh’s remarks at the Jackson Hole symposium for guidance on the US interest rate outlook. At the same time, inflation readings from France and Spain signaled renewed price pressures, reinforcing expectations of a European Central Bank rate hike in September. EU-harmonized inflation rose to 2.7% in France, a three-month high, while Spain’s rate climbed to 4.5%, its highest level since 2023 and more than twice the ECB’s 2% target. Money markets now price the ECB deposit rate at 2.80% by March next year, up from 2.25% currently, and around 2.90% by late 2027, implying roughly a 60% probability of a move to 3%. Recent ECB meeting minutes have pointed to another likely increase, and Reuters reported that policymakers are prepared to raise rates in September to contain the economic fallout from the Iran war, though they remain hesitant to signal any further tightening beyond that.