- The USD traded higher against major world currencies as Federal Reserve Chair Jerome Powell said the central bank may need to raise interest rates further to ensure inflation is contained but promised to move "carefully" at upcoming meetings.
- Powell, in a speech at an economic summit in Jackson Hole, Wyoming, said policymakers would "proceed carefully as we decide whether to tighten further," but also made it clear that the central bank has not yet concluded whether its benchmark interest rate is high enough to be sure that inflation returns to the 2% target.
- Powell’s speech comes after several Fed officials indicated that more rate hikes are needed. Boston Fed President Susan Collins and St. Louis Fed President James Bullard said that more hikes may be needed to bring inflation down.
- US business activity data showed that the US economy was stalling. The composite PMI fell to 50.4 in August, down from 52 in July, posting the weakest growth since February as demand for new business in the service sector contracted.
- The INR traded under pressure against a stronger USD, and domestic equities slid.
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