The market is betting that Powell will maintain a hawkish stance, and the bullish sentiment on the US dollar has risen to a three-week high.

According to Jinshi Data, currency options indicate bullish sentiment for the US dollar has risen to its highest level in three weeks. Traders are generally betting that Federal Reserve Chairman Powell will maintain a hawkish stance on interest rate policy. Sonja Marten, head of foreign exchange and monetary policy research at Deutsche Bank, believes that while a 25 basis point rate cut in September is possible, Powell is unlikely to take more aggressive measures and may resist pressure from the White House to cut rates. Nick Rees, head of macro research at Monex Europe, said that if Powell's comments suggesting a possible rate cut in September are overinterpreted by the market, it could trigger a brief sell-off in the US dollar. However, overall, the market expects a hawkish tone, which may push the US dollar further stronger before the end of the week.