The US dollar is showing some softness ahead of the much-anticipated September Consumer Price Index (CPI) report. While the euro and Canadian dollar have touched new lows, the greenback extended its gains against the Japanese yen, reaching JPY149.55, before retreating to JPY148.85 in European trading. Gold prices remain steady, having established a firm support level near $2,600, while November WTI crude oil is consolidating at the higher end of yesterday’s range amid escalating risks of the conflict in the Middle East.

Asia Pacific Markets
Despite a record 2.9% year-over-year increase in Japan's base pay in August, household spending fell by 1.9% year-over-year, suggesting consumers are still cautious. On a brighter note, month-over-month household spending rose, even as inflation-adjusted wages declined.
The US dollar climbed higher yesterday, reaching a two-month high near JPY149.55 in Asian trading today. However, this momentum weakened during the European session, pushing the dollar down to JPY148.85.
The Australian dollar has struggled for the fifth consecutive session, edging closer to $0.6700, a level it hasn't breached since mid-September.

European Markets
The eurozone's economic calendar is relatively light for the next few days, with the next major data point being August’s aggregate industrial production report, due next Tuesday. Strong industrial growth in Germany and France suggests that the eurozone could see its largest production gain since late last year.
The euro, which consolidated after the US jobs report on Monday and Tuesday, broke lower yesterday and continues to struggle for support, dropping to around $1.0925 in European trading.
Meanwhile, the British pound is also under pressure, hovering near yesterday’s low of $1.3055.

American Markets
Today’s focus in the North American session is squarely on the September US CPI report. Analysts surveyed by Bloomberg expect a modest 0.1% increase, following 0.2% increases in both July and August. Tomorrow, the US will release September's producer price index (PPI), which will help economists fine-tune their estimates for the Federal Reserve's preferred inflation measure, the PCE deflator.
In addition, Canada will release its September employment data tomorrow.
The US dollar is continuing its upward trajectory for the seventh consecutive day against the Canadian dollar, touching CAD1.3735 in European trading.