The US dollar is consolidating within narrow ranges against most G10 currencies, while emerging market currencies show mixed but generally quiet activity. US index futures remain largely unchanged. Gold is firm, edging towards its May high of $2,450. September WTI crude oil, which was turned back from above $82 per barrel at the end of last week, is now testing the July low near $80.

Asia Pacific Markets
The dollar traded within a range of approximately JPY157.20 to JPY158.40 yesterday, during a Tokyo holiday. A review of the Bank of Japan's (BOJ) accounts suggests it intervened not only last Thursday but also the following day. Today, the dollar rose to nearly JPY158.80 in the Tokyo afternoon, despite the 10-year US yield unwinding yesterday's increase in full. Nearby resistance is observed around JPY159.00. Meanwhile, the Australian dollar, which stalled near $0.6800 last week, has rallied nearly two cents over the past month and appears to be losing momentum. Initial support is seen around the $0.6730 area, which it approached today.

European Markets
Investor sentiment in Germany remains poor, as reflected in the ZEW survey. Expectations fell to 41.8 from 47.5, and the assessment of the current situation remains depressed at -68.9 compared to -73.8. The euro stalled yesterday just above $1.0920, its highest level since March 21. Near-term consolidation appears likely. Sterling edged closer to $1.3000 but then reversed lower, settling near session lows below $1.2960. Today, it edged slightly lower but found support ahead of $1.2950.

American Markets
A disappointing US retail sales report today could challenge the consolidation outlook for the greenback. Headline sales are likely to be dragged lower by weak auto sales. The Dollar Index (DXY) successfully tested the 104.00 level, marking early last month's lows. Notably, DXY has not settled below 104.00 since March 20.
The swaps market is pricing in over an 80% chance that the Bank of Canada will cut rates next week, ahead of today's June CPI report. The greenback, which rebounded sharply from a false break of CAD1.36 last week, rose to nearly CAD1.3690 yesterday and edged slightly higher today. The CAD1.3700-20 area may present resistance.