US dollar demand hits multi-month high

Key Movers

The USD/JPY pair is closing in on 11-month highs. Bank of Japan (BoJ) Governor Kazuo Ueda spoke last week, announcing their stance to gradually maintain monetary easing, aiming for the sustainable achievement of 2% inflation, at which point they may end yield curve control.

In European news, the German Information and Forschung (IFO) business climate index was reported at 85.7, marginally better than the forecasted 85.1, but still a slight drop from the previous 85.8. European Central Bank’s (ECB) François Villeroy de Galhau reported growing confidence in hitting the 2% inflation target by 2025. He also acknowledged the risk of easing too early, while fellow ECB member Isabel Schnabel said shrinking money supply isn’t signaling a deep recession.

The GBP/USD pair remains under pressure at 6-month lows following the Bank of England’s (BoE) decision to keep rates at 5.25% last week. The UK Confederation of British Industry (CBI) posted realized sales data at -14. This indicated a lower sales volume, but much better than the expected -33 and the previous -44.

The USD/CAD pair had mixed trading the past few days. The pair is currently down -0.05 % at the time of writing to 1.347, hovering between the first support level of 1.3377 and the resistance level of 1.3694. Oil is down 0.18% from Friday’s close, currently trading at 90.12 a barrel. Oil prices are steadying as Russia eases the fuel export ban. Canadian July Average Weekly Earnings year-over-year is set to be released on Thursday ahead of July’s monthly Gross Domestic Product data on Friday.