Later today the Chairlady of the US Federal Reserve, Janet Yellen will provide her latest thoughts on monetary policy at the Jackson Hole Symposium in Kansas City. The Jackson Hole event is the coming together of economic leaders from around the World to discuss problems they face and to help find solutions.

Janet Yellen’s speech is much anticipated, and could provide further insight into the likelihood of another interest hike in the US during 2017. At the start of the year US economic data had been flourishing, however, after a couple of rate hikes already this year, whether there will be any further hikes is not certain. Mrs Yellen could provide an indication as to what the chances are for another hike or whether it will wait till next year.

It is worth noting that Janet Yellen is in her final six months of her term at the Head of the Federal Reserve and in February 2018 she will step aside. President Donald Trump has always been vocal about Mrs Yellen, suggesting she is overly negative and has not been aggressive enough in raising interest rates. Therefore we may see someone more suited to his agenda take up the position in February which may take American economic growth to the next level.

If in the US there are several rate hikes and the interest level resides around 2% there will be huge investment in the US Dollar. Considering there is no major developed nation with interest rates at that level, the security you get with the Dollar and the potential returns will make the currency incredibly attractive.

If Sterling is still struggling at the start of 2018 we may start to see the GBP/USD fall back to the low 1.20’s. If the current concerns with North Korea comes to an end then there is likely to be more imminent USD strength.