TLDR
- The Dollar Spot Index rose 0.2% to 99.61, near a two-week high
- U.S. job openings held at 7.3 million in July, showing a resilient labor market
- Markets now price a 74% chance of a Fed rate hike on September 17
- The euro fell 0.20% to $1.1592 after Eurozone core CPI eased to 2.4%
- The yen edged up slightly but stayed near 159.85, close to the critical 160 level
The U.S. dollar held near a two-week high on Tuesday after fresh jobs data kept expectations for a Federal Reserve rate hike firmly on the table.
The Dollar Spot Index rose 0.2% to 99.61, building on gains from last week when Fed Chair Kevin Warsh delivered a hawkish speech at the Jackson Hole symposium.
Jobs Data Supports the Dollar
The July JOLTS report showed U.S. job openings were little changed at 7.3 million. The job openings rate held at 4.4%, while hires slipped to 5.1 million from 5.3 million in June.
JOLTS job openings 7.271MM, Exp. 7.313MM, Last 7.182MM (revised down from 7.359MM)
— zerohedge (@zerohedge) September 1, 2026
Quits also remained steady at 3.1 million, a sign that workers still feel confident enough to leave their jobs. That points to a labor market that has not weakened as much as some expected.
Warsh made clear at Jackson Hole that the Fed is still focused on getting inflation back to its 2% target. Core PCE currently sits at 3.3%, leaving the central bank with more work to do.
Money markets now price a 74% chance of a 25 basis point rate hike at the Fed’s September 17 meeting. That is up sharply from just 34% before Warsh’s speech.
The 10-year Treasury yield rose 3 basis points to 4.80%, its highest since January 2025. Rising yields are helping the dollar by widening the gap with rates in other countries.
Euro and Yen Under Pressure
The euro dropped 0.20% to $1.1592. Eurozone headline inflation jumped to 3.3% year-on-year in August, up from 2.9% in July. But core CPI, which strips out energy and food, eased to 2.4% from 2.5%.
That split makes things complicated for the European Central Bank ahead of its own September meeting. The softer core reading could limit the ECB’s room to match Fed tightening.
The Japanese yen edged up 0.10% to 159.85 per dollar, staying just below the 160 level that has previously triggered currency interventions.
U.S. Treasury Secretary Scott Bessent called on Bank of Japan Governor Kazuo Ueda to raise interest rates at the G20 meeting in Asheville. He said he has “information that the market doesn’t have” about Japanese stabilization efforts.
Upcoming Data in Focus
Swap markets lifted the probability of a Bank of Japan rate hike at its September 17-18 meeting to nearly 88%. The 10-year Japanese government bond yield rose 5 basis points to 3.00%, its highest in three decades.
Crude oil held near $91.10 a barrel, following U.S.-Iran military engagements, adding another layer of pressure on global markets.
ADP private payrolls are due Wednesday, with August Nonfarm Payrolls following on Friday. U.S. August CPI data, due next week, will be the last major reading before the Fed’s rate decision.
A hotter-than-expected CPI print could push September hike odds even higher and extend the dollar’s recent rally.
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