Dollar steady ahead of Powell speech; Ueda aims to calm market nerves

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Key Points

SINGAPORE (Reuters) The U.S. dollar was calm on Friday as traders braced for comments from Federal Reserve Chair Jerome Powell, while Bank of Japan (BOJ) Governor Kazuo Ueda aimed to soothe lingering market nerves after a surprise rate hike last month...

The spotlight will be on the central bankers on Friday, first on BOJ Governor Ueda who is in Japans parliament to discuss the surprise decision to hike interest rates last month that rattled investors and sent the yen soaring...

Bouts of interventions and an interest rate hike in July tripped up investors who unwound the popular carry trade, in which traders borrowed yen to finance high-yielding assets, yanking the yen away from the 38-year lows touched last month...

The move coupled with worries of U.S. recession triggered a massive global selloff in early August, although most markets have recovered since then.. Markets at home and abroad remain unstable, so we will be highly vigilant to market developments for the time being, Ueda said in parliament...

Markets are now pricing in more rate cuts from the Federal Reserve by year-end than for the European Central Bank or Bank of England...

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