The dollar held firm on Friday after the U.S. Federal Reserve’s hawkish wing called for tapering bond purchases as investors looked to a highly-anticipated speech by Fed Chair Jerome Powell later in the day.

The dollar index stood at 93.032, bouncing back from Thursday’s low of 92.807 as the euro traded at $1.1755, having eased from the previous day’s high of $1.1779.

The common currency was not helped by a survey showing German consumer sentiment darkened heading into September due to accelerating inflation and rising Covid-19 cases.

Sterling also dropped to $1.3703. Against the yen, the dollar stood little changed at 110.06 yen.

Dallas Federal Reserve President Robert Kaplan suggested he expects the Fed to start raising interest rates next year, a comment that analyst took as more hawkish than last week when he appeared nervous about the potential impact of the delta variant.

Two other regional Fed chiefs — Kansas City Fed President Esther George and St. Louis Federal Reserve President James Bullard — also downplayed the impact of the delta variant in separate interviews, with Bullard repeating his call for the Fed to start trimming its $120 billion in monthly bond purchases soon.

Many investors, however, think Powell will strike a more dovish tone in his speech at 1400 GMT in the Kansas City Fed’s central banking conference.

The event, which normally takes place in Jackson Hole, Wyoming, but is being held virtually for the second straight year due to the pandemic, has been often used by Fed policymakers in the past to provide guidance on their future policy.

“While Chair Powell is likely to … lay the groundwork for an eventual taper, we expect him to err on the side of caution and patience this week given that the macroeconomic landscape has deteriorated since the July policy gathering,” said Candice Bangsund, portfolio manager at Fiera Capital in Montreal, Canada.

Rough consensus in the market is that Powell will likely announce tapering in the fourth quarter, giving a clear signal at one meeting before the actual announcement.

“For Powell, there is no merit in specifying the exact timing for tapering at today’s speech. If he doesn’t drop a clear hint, that will be mildly positive for stocks,” said Kyosuke Suzuki, president of financial algotech company at Ryobi Systems.

Risk-sensitive currencies are likely to gain while the yen is likely to weaken in that case, he added.

For now, the dollar was supported also by caution after a suicide bomb attack in Kabul airport killed scores of civilians and 13 U.S. troops. Islamic State claimed responsibility.

Elsewhere, the Australian dollar fetched $0.7243 ahead of the country’s retail sales data.

In cryptocurrencies, bitcoin slipped to $47,43 while ether also eased to $3,142