TD Securities: If the Fed Keeps Rates Unchanged, the Dollar May Fall

July 28th - JPMorgan strategists said in a report that if the Fed keeps interest rates unchanged on Wednesday, the dollar could see a reflexive softness. Rates are expected to remain unchanged, but Fed's Harker and Mester will likely dissent, advocating for a rate hike. Nevertheless, as expectations for Fed rate hikes through the remainder of 2026 remain intact, any short-term dollar weakness could be limited.

JPMorgan expects that Powell is unlikely to offer forward guidance but will reiterate a commitment to price stability. They suggest that Powell may point to the recent drop in inflation data while hinting that inflation remains elevated.