The yen is the strongest performer in the G10 currency group today, appreciating approximately 0.65%, as escalating geopolitical tensions in Europe, combined with comments from Bank of Japan Governor Ueda regarding potential rate hikes in December, continue to drive market sentiment. The euro is the weakest of the major currencies, declining just over 0.25%, while the British pound follows closely behind with a nearly 0.25% drop. The rest of the G10 currencies are largely unchanged, with equities weaker and bond prices firmer.
Gold is showing a steady recovery after a six-session losing streak, having gained every day this week. January WTI crude oil is trading within yesterday's range, showing little volatility.

Asia Pacific Markets
In Asia, Bank of Japan Governor Ueda’s remarks about the December meeting being "live" and the central bank considering exchange rate impacts on inflation have supported a sharp rebound in the yen. The US dollar reached a high near JPY155.90 in North American trading yesterday before stalling just shy of JPY156. The greenback then retraced to JPY155.10 before European market hours and consolidated throughout the North American afternoon. It has since weakened further to around JPY154.10 today.
The Australian dollar underperformed, hitting a five-session high of $0.6545 during the local session yesterday but then trending lower to $0.6485.

European Markets
Looking ahead, tomorrow’s preliminary Eurozone manufacturing PMI report will be closely watched, especially as it has not risen above the neutral 50 threshold since June 2022. In its November report, the Bundesbank noted that while Germany surprised with 0.2% GDP growth in Q3, a continuation of economic stagnation is expected in Q4.
The euro appears vulnerable, trading at the lower end of yesterday’s range. Meanwhile, sterling has mostly consolidated in the North American afternoon, ranging between $1.2640 and $1.2660, but has since dipped below yesterday’s lows, putting last week’s low near $1.26 in focus.

American Markets
In the US, today’s economic data is unlikely to significantly alter the broader economic outlook. Tomorrow’s preliminary PMI data may have a slightly greater influence, though markets still show a preference for the ISM surveys. Fed expectations have stabilized, with the probability of a December rate cut now around 60%, down from over 80% earlier in the week.
The US dollar has pulled back from its high of CAD1.41 at the end of last week, easing to just below CAD1.3950 earlier this week and holding steady around this level today, remaining below CAD1.40.