Forex Today: US Dollar firms ahead of global flash PMIs

Here is what you need to know on Friday, August 21:

The US Dollar Index (DXY) is hovering near 98.90, still short of 100.00, but grinding higher on Thursday. Hawkish commentary from Federal Reserve Bank of St. Louis President Alberto Musalem did much of the work: he called underlying inflation too high, saw a lower chance of returning it to target at current rates, and suggested that raising rates now could spare the Federal Reserve (Fed) more aggressive action later.

Heading into a data-heavy Friday dominated by flash Purchasing Managers Index (PMI) surveys across Europe, the United Kingdom (UK) and the United States (US), the Greenback carries a modest bid.

The Euro and the Pound held their ground, while a sharp jump in Oil prices lifted the commodity bloc, keeping the Canadian Dollar supported and limiting the Dollar's reach outside the Japanese Yen.

EUR/USD clung to the mid-1.1600s, ending little changed as traders stood aside ahead of the Eurozone flash PMIs.

GBP/USD edged higher, holding north of the 1.3600 mark despite the firmer Dollar, with a heavy UK data slate in focus on Friday.

USD/JPY pushed higher, reclaiming ground beyond the 159.00 barrier as hawkish Fed speak weighed on the Yen.

AUD/USD lost its grip, slipping back toward the 0.7100 area after soft domestic jobs data and ahead of Australia's flash PMIs.

Gold held steady near $4,520 per troy ounce, holding onto its recent gains.

West Texas Intermediate (WTI) Oil extended its advance, pushing toward $87.00 per barrel amid ongoing Middle East tensions.

The Asian session opens with Australia's preliminary S&P Global PMIs. After a weak employment report and firmer inflation expectations, a soft set of surveys would add to the pressure on the Aussie.

The European morning is the main event. UK Retail Sales for July kicks things off and is expected to slip on the month. Then the flash PMI cascade offers France, Germany and the Eurozone HCOB surveys, followed by the UK's own S&P Global PMIs.

Across the Atlantic, Canadian Retail Sales precede the US S&P Global flash PMIs, the pick of an otherwise light US calendar.

Beyond Friday, attention turns to next week's Jackson Hole Symposium, where new Fed Chair Kevin Warsh delivers his first keynote speech that might offer a glance at the September policy decision.