USD/JPY Extends Gains in Cautious European Session Ahead of Jackson Hole

European trading delivered a more pensive tone with USD/JPY extending gains as traders positioned ahead of Fed Chair Warsh's Jackson Hole speech, while gold stayed locked in a tight range. Data flow offered little direction: France's final Q2 GDP was revised down to 0.0% q/q from the 0.2% preliminary reading, French August preliminary CPI matched expectations at 2.4% y/y, and Spanish August preliminary CPI came in slightly hot at 4.3% y/y versus 4.2% expected. German unemployment rose by less than forecast in August, offering modest relief to the euro. Interest rate expectations have shifted through the week, though desks flagged that Jackson Hole may deliver no fresh guidance. Month-end fixing flows were seen as mildly supportive of the dollar, adding a technical tailwind to USD pairs. EUR/USD remains rangebound with the soft French GDP capping upside, while USD/JPY buyers continue to lean on the yield differential. Traders should expect subdued liquidity and range-bound conditions to persist until the Fed messaging is digested, with breakout risk skewed toward the dollar.