• Across the board USD strength sends USD/JPY back up into 160 handle

• Asia so far 160.15-23 EBS, resistance still felt above 160.20

• Japanese exporters, others good sellers 160.20+, 160.27 cap yesterday

• Flat 100-DMA at 160.03 to work as pivot going forward?

• Eyes too on daily Ichimoku cloud, today 161.29-162.64

• To descend rapidly to a line at 159.59 by weekend, early next week

• Good bounce from hourly Ichimoku cloud yesterday, now 159.75-78

• Hourly tenkan at 160.14, kijun below at 159.95, cloud 159.75-78

• Chock-a-block option expiries on 159 handle, total over $5.4 bln

• Large today between 160.00-20 too, total $2.3 bln, also supportive

• Only smattering of expiries above today to 161.00, $554 mln at strike

• US yields up o/n but JGB-US Tsy 2-year rate diffs off highs to @256 bps

• Market has plenty of G20-related news to digest, geopolitical news too

• Middle East military action, high crude prices to keep inflation focus

• Related comments , , ,

• And , also , on Middle East

• US markets , , ,
USD/JPY:


USD/JPY nearby option expiries this week:


JGB-US Treasury 2-year interest rate differential:

(Haruya Ida is a Reuters market analyst. The views expressed are his own)

• NZD/USD -0.7% from Tue 0.5928 high despite expectations of RBNZ hike Wed

• Break below 0.5909 21-DMA a bearish signal that may bookend 9-week rally

• DXY & UST yields higher after U.S. renews attacks on Iran, WTI +5.2%

• Futures pricing now implies 67.5% probability of Fed rate hike in Sep

• Crucial U.S. Aug non-farm payrolls due Fri, Reuters poll consensus +56k

• Range NZ 0.58875-925, support 0.5821 0.5762, resistance 0.5995 0.6012
NZD Daily 21/55/100-DMA

(James Connell is a Reuters market analyst. The views expressed are his own.)

MUFG Research previews this week's RBNZ and BoC September policy meetings.

"The RBNZ is set to hike while the Bank of Canada is likely to remain on hold. The RBNZ has been cautious on hiking rates from the current accommodative level (2.50%) but the inflation backdrop will compel action tomorrow especially given the renewed move higher in energy prices. Still, there is 100bps of tightening in the RBNZ OIS curve and we remain scpetical of the RBNZ delivering that amount of tightening over the next 12 months," MUFG notes.

"The Bank of Canada has other risks to consider following the escalation of the trade war with the US and the risk of auto, auto parts, steel and light & heavy truck tariffs being lifted from 25% to 50% at the start of 2027 will act to dampen Canadian corporate sentiment. The Canadian dollar will likely continue to underperform until there is clarity on tariffs in both direction," MUFG adds.

• AUD/USD -0.5% from Tue 0.71805 high, while DXY & UST yields grind higher

• U.S. launches fresh strikes on Iran, Brent crude +5.2% to $95.13 a barrel

• Futures pricing now implies 67.5% probability of Fed rate hike in Sep

• AU Q2 real GDP due Wed, Reuters poll consensus +0.3% q/q, +1.8% y/y

• AUD may drift toward 0.7108 21-DMA, break below may encourage short sellers

• RBA's Sarah Hunter & Dr James Bishop appear before Senate Committee Thur

• Pivotal U.S. Aug non-farm payrolls due Fri, Reuters poll consensus +55k

• Overnight range 0.7139-653 support 0.6920 0.6866, resistance 0.7210 0.7282
AUD Daily 21/55/100-DMA

(James Connell is a Reuters market analyst. The views expressed are his own.)

• GBP$ soft heading into NY close, -0.24% at 1.3514; NorAm range 1.3558-1.3513

• Gilt yields rise, follow JGB yields to fresh 19-yr highs, UK fiscal angst weighs on GBP$

• US-Iran conflict back in focus send oil prices, inflation expectations higher

• Fed rate hike expectations remain at post-JHole highs; Sept Fed hike odds at 0.68%

• GBP$ supt 1.3513 Tuesday low, 1.3500 psychological lvl, 1.3443-36 multiple daily MAs

• Res 1.3558 Tuesday high, 1.3596 the 10-DMA, 1.3648 daily high August 26

GBP Chart:

(Paul.Spirgel is a Reuters market analyst. The views expressed are his own)

Morgan Stanley Research previews Australia Q2 GDP report due on Wednesday.

"We expect GDP for Q2 to increase 0.5%Q, with annual growth slowing from 2.5% to 2.1%Y. This would be consistent with growth around trend rates, but only very modest per capita growth. We expect relatively broad contributions across categories. Consumer spending growth is expected to be similar to the prior quarter, with modest growth - a solid outcome given some of the income headwinds in the quarter," MS notes.

"Investment growth slowed sharply in the quarter although this entirely reflected a reversion of data centre machinery spending, the vast bulk of which was imported. We expect an offsetting positive contribution from trade (net exports+0.4ppts), with underlying capex trends still quite positive. Government spending is also expected to be a contributor to growth," MS adds.

Soft U.S. economic data and a lack of fresh catalysts are taking some momentum out of Tuesday's USD/JPY advance.

The pair has pulled back to 160 as the dollar eases after weaker-than-expected August ISM manufacturing and lackluster JOLTS data. An elevated ISM prices component should help preserve the Fed's hawkish bias, limiting the scope for a deeper dollar correction.

But the latest U.S. data does little to ease concerns over rising oil prices and expanding fiscal deficits keeping the yen defensive.

For Japan, rising debt burdens and higher interest rates remain particular challenges. Yen bulls expecting a more aggressive BOJ tightening path under U.S. pressure for hikes and higher domestic inflation risk being disappointed.

Government claims that fiscal discipline and stronger growth can resolve debt concerns remain unconvincing to many yen investors, while rising yields are also encouraging Samurai bond issuance, potentially adding support to USD/JPY if proceeds are converted into foreign currencies.

As such, USD/JPY remains cautiously bullish within the ascending channel that has been in place since the 155.20 intervention low.

While comments from Finance Minister Satsuki Katayama have kept intervention concerns alive and markets nervous above 160, a close above the upper Bollinger near 160.43 and channel resistance would expose the 61.8% Fibonacci retracement at 160.63 and the April 30 intervention high at 160.72.

Conversely, a break below 159.60 and the 21-day moving average near 159.08 would significantly weaken the bullish outlook.
Yen

(Robert Fullem is a Reuters market analyst. The views expressed are his own.)

Goldman Sachs Research previews the US August jobs report due on Friday.

"We expect a 40k increase in payrolls in August (vs. 55k consensus), in part reflecting a negative first print bias. Our forecast reflects a softer signal from alternative data. August payrolls have also shown a consistent negative bias—particularly in initial prints—over the last decade.

"We expect a 0.4% increase in average hourly earnings, reflecting positive calendar effects. AHE growth fell to just 3.2% year-over-year last month, and our broader wage tracker has stabilized in the mid-3s. We expect the unemployment rate to stay at 4.1%, reflecting a stabilization in continuing claims," GS adds.

Sterling looks vulnerable to further downside as it consolidates below 1.36, with bulls on the back foot amid heightened UK fiscal uncertainty, relentlessly rising long-end gilt yields and Middle East ructions lifting oil prices in a sign of persistent global inflation.

Amid subdued end-of-summer trading, cable found support near 1.3525, its recent trend lows.

The dollar strengthened following hawkish Federal Reserve policy expectations spurred by Chair Kevin Warsh's comments at the Jackson Hole Symposium last week. Adding to the dollar bid is the rise in global yields after Japanese yields climbed above 3% for the first time in 30 years. Sterling yields followed suit, rising 7 basis points and ticking a new multi-decade high at 5.26% as traders returned from Monday's UK Bank Holiday.

With oil rising, it seems increasingly likely that elevated inflation expectations globally are likely to persist. That may lift UK second-round inflation expectations, tempering optimism for a near-term recovery in Britain and further exacerbating fiscal concerns, which will add downside pressure to UK assets, including sterling.

Technically, sterling finds initial support at today's 1.3526 low, then 1.3475, the August 13 low, with more significant support at 1.3444-37, the 100-,200- and 50-DMA area. Bulls need a close above 1.3599, the flattening 10-DMA, to stall the mounting bearish outlook.
GBP$ Chart:

(Paul Spirgel is a Reuters market analyst. The views expressed are his own)

RBC Research summarizes its latest outlook and targets for Gold.

"We remain of the view that gold should spend most of its time in the $4500-5000/oz range for what remains of this year (a view unchanged and with high conviction), and we now specifically highlight our middle-to- high scenario range for Q3 and Q4 (as well as annual) for gold prices going forward," RBC notes.

"By year-end, we are leaning towards our 2026 high scenario ($4929/oz), and similarly, in 2027, we favor our high of $5296/oz. Regardless, our mid-to-high scenario range remains the most likely price band across our forecast horizon," RBC adds.

Bank of America Global Research notes that USD downside protection remains attractive, particularly versus EUR and CHF.

(Repeat with no changes )

• FX option strikes expire at 10am New York/14:00 GMT on Tuesday September 1

• EUR/USD: 1.1540-50 (1.6BLN), 1.1580-90 (1.9BLN), 1.1600 (2.3BLN), 1.1625-35 (1.5BLN), 1.1650 (2.1BLN)

• USD/CHF: 0.8060 (220M), 0.8100 (606M), 0.8170 (580M)

• GBP/USD: 1.3550 (603M). EUR/GBP: 0.8525-30 (537M)

• AUD/USD: 0.7100-10 (1.1BLN), 0.7125 (369M), 0.7155 (488M)

• NZD/USD: 0.5850-65 (245M), 0.5940-50 (233M), 0.5975 (210M)

• AUD/NZD: 1.1995 (337M), 1.2100 (250M)

• USD/CAD: 1.3855-60 (455M), 1.3920 (451M)

• USD/JPY: 159.45-50 (605M), 159.68 (626M), 160.00 (440M), 161.00 (595M)

• AUD/JPY: 114.35 (423M). EUR/JPY: 183.83 (420M)(Richard Pace is a Reuters market analyst. The views expressed are his own)

• GBP/USD holds a narrow range but bias leans lower as U.S. yields surge

• Dollar continues to firm post-Warsh, with market pricing now at 67% for a Sept Fed hike

• Cross-selling in EUR/GBP offers some support, but cable remains driven by USD dynamics

• Initial support at 1.3527 (last week's low), a break opens 1.3500 then 1.3442 (200-day MA)

• Resistance sits at 1.3600, then 1.3675
GBPUSD daily

Justin McQueen is a Reuters market analyst. (The views expressed are his own). ((Email: ))

• AUD under pressure as bonds sell-off, weighs on risk appetite. Range: 0.7145-81

• U.S. 10yr yield breaks 4.75%, now at highest level since January 2025

• Eyes on the 30yr yield, currently at 5.28%, a break above the 5.34% YTD high would likely extend USD bid

• Dollar firmly in the ascendancy, underpinned by the hawkish Fed repricing

• Market implied odds now price a 67% chance of a Sept Fed hike, up from 60% on Monday

• With the USD bid broad based, AUD strength still looks better expressed on the crosses
US 10yr yield

Justin McQueen is a Reuters market analyst. (The views expressed are his own). ((Email: ))

• FX option risk reversal contracts are an FX volatility strategy, but their pricing reveals directional sentiment

• Price action in risk reversals shows the FX direction expected to increase volatility - often the most vulnerable side

• Benchmark 1-month 25 delta EUR/USD risk reversals went from a neutral bias to 0.25 EUR puts over calls since Friday

• Hawkish Warsh comments at Jackson Hole are driving this shift in EUR/USD risk premium from upside to downside

• Recall, 1-month risk reversals flipped from downside to topside strikes in mid August for the first time since February

• Building on this fresh downside skew would confirm bearish momentum is regaining control of EUR/USD sentiment

• Related - Finding value in FX options for NFP, CPI and the Fed

• Related - EUR/USD boxed in by techs and huge option hedging before NFP
EUR/USD 25 delta risk reversals

(Richard Pace is a Reuters market analyst. The views expressed are his own)

• EUR/USD recovers 1.1625 Tuesday since the post US Fed chair Warsh inspired drop from 1.1660-1.1578 Friday

• The 100-dma at 1.1570 underpins, while the 200-dma at 1.1634 adds resistance to the current range

• Big FX option expiries and related hedging flows help contain FX as London returns from a bank holiday weekend

• €4.2 billion strikes between 1.1580-1.1600 and €1.5 billion 1.1625-35 expire at 10-am New York/14.00 GMT Tuesday

• More 1.1600 strikes expire all week, with hedging likely to contain EUR/USD in the absence of any fresh catalysts

• Market may stay sidelined into Friday's US jobs data, leaving FX option hedging flows dominant near term
EUR/USD daily chart (EBS)

EUR/USD FX option strikes expiring between September 1-4 Click here

(Richard Pace is a Reuters market analyst. The views expressed are his own)

• USD/JPY has seen a 159.64-159.98 range, on Tuesday, according to EBS data

• Yen lingers near 160 as U.S. Treasury Secretary Bessent leans on BOJ

• Bessent expects Japan to take action to boost yen, signals BOJ rate-hike chance

• Bullish as trading remains above 159.60 Fibo, 50% retrace of 163.99-155.20 intervention fueled drop

• There is scope for bigger gains to 160.63 Fibo, a 61.8% retrace of the same fall

• Fin Min Katayama: Japan, US confirmed policy behind joint yen action to achieve "orderly" moves

• USD/JPY and EUR/JPY tend to move in tandem, log correlations are high above +0.5

Daily Chart


Correlation Chart

(Martin Miller is a Reuters market analyst. The views expressed are his own)

• FX option strikes expire at 10am New York/14:00 GMT on Tuesday September 1

• EUR/USD: 1.1540-50 (1.6BLN), 1.1580-90 (1.9BLN), 1.1600 (2.3BLN), 1.1625-35 (1.5BLN), 1.1650 (2.1BLN)

• USD/CHF: 0.8060 (220M), 0.8100 (606M), 0.8170 (580M)

• GBP/USD: 1.3550 (603M). EUR/GBP: 0.8525-30 (537M)

• AUD/USD: 0.7100-10 (1.1BLN), 0.7125 (369M), 0.7155 (488M)

• NZD/USD: 0.5850-65 (245M), 0.5940-50 (233M), 0.5975 (210M)

• AUD/NZD: 1.1995 (337M), 1.2100 (250M)

• USD/CAD: 1.3855-60 (455M), 1.3920 (451M)

• USD/JPY: 159.45-50 (605M), 159.68 (626M), 160.00 (440M), 161.00 (595M)

• AUD/JPY: 114.35 (423M). EUR/JPY: 183.83 (420M)(Richard Pace is a Reuters market analyst. The views expressed are his own)

• GBP/USD consolidates in a narrow range with UK markets closed Monday

• Holds near Fri's 2-week low hit after Warsh's hawkish Jackson Hole speech

• Rising Fed rate hike bets cap GBP; odds of Sep 16 hike at 66% from 35% Fri

• U.S. payrolls this Friday, inflation data next week key for direction

• UK retailers raise prices by most since 2024, BRC data shows

• Support 1.3525-30, 1.3500,1.3475-80; resistance 1.3570-75, 1.3600-05

• Monday range 1.3531-1.3565, Asia 1.3543-1.3568
GBP:

(Krishna Kumar is a Reuters market analyst. The views expressed are his own.)

• EUR/USD rallied to 1.1620 EBS yesterday, Asia to 1.1624 before off to 1.1607

• Holding for now between 100-DMA at 1.1569 and 200-DMA above at 1.1634

• Also holding in 1.1601-18 hourly Ichimoku cloud, descending 100-HMA 1.1632

• Option expiries today to again help contain spot action

• Between 1.1500-95 E5.4 bln, at 1.1600 E2.3 bln, 1.1625 to 1.1700 E5.2 bln

• EUR/JPY 185.46-62 EBS, at top of 184.92-185.47 daily Ichimoku cloud

• Below 185.62 100-HMA, 185.66-70 hourly Ichimoku cloud, above 185.15 200-HMA

• EUR/GBP indicated 0.8574, in 0.8536-92 tapering daily Ichimoku cloud

• Sideways action may see break above cloud, also above 0.8571-74 hourly cloud

• Option expiries today E804 bln between 0.8500-60, smattering 0.8575-0.8650

• EUR/CHF well bid again Asia 0.9390-96 EBS, towards 0.9409 peak August 14

• Seems CHF-funded carries being put back on after recent dips

• Related comments , also , for more click on [FXBUZ]

EUR/USD:


EUR/USD nearby option expiries this week:


EUR/CHF:

(Haruya Ida is a Reuters market analyst. The views expressed are his own)

• AUD/USD -0.2% from Tue morning's 0.71805 high as oil prices continue to rise

• AU Q2 current account -27.2 bln (poll -30.0), Jul building approvals -3.6%

• Renewed U.S.-Iran hostility driving energy prices higher, Brent crude +0.6%

• AUD needs 0.7210 break to resume uptrend, below 0.7100 would encourage bears

• AU Q2 real GDP due Wed, Reuters poll consensus +0.3% q/q, +1.8% y/y

• RBA's Sarah Hunter & Dr James Bishop appear before Senate Committee Thur

• U.S. Aug non-farm payrolls due Fri, Reuters poll consensus +55k

• Range Asia 0.7164-805 support 0.6920 0.6866, resistance 0.7210 0.7277-82
AUD Daily 21/55/100-DMA

(James Connell is a Reuters market analyst. The views expressed are his own.)

• Shares of Australia's West Coast Silver fall as much as 13% to A$0.100, marking their biggest intraday pct loss since June 10

• Stock was on trading halt since August 28

• Shares hit their lowest level since August 17

• Diversified miner announces A$6 million ($4.31 million) placement at A$0.095 per share, a 17.4% discount to stock's last close

• Says proceeds will be used for exploration and development drilling at Elizabeth Hill South and West project in Western Australia, among others

• Nearly 2.4 mln shares change hands, about 2.5x the 30-day average

• YTD, stock down 51.1%, including session's moves

($1 = 1.3933 Australian dollars)

(Reporting by Subhalakshmi Dey in Bengaluru)

• USD/JPY looks to be on hold again below recent highs, Asia 159.72-84 EBS

• Holding for now in 159.65-92 hourly Ichimoku cloud, 100-HMA 159.52 below

• Cloud to begin to taper during course of global day, break below? Above?

• 100-DMA 160.01 above, daily Ichimoku cloud too between 161.29-162.61

• JGB-US Treasury 2-year rate differentials wider overnight, @258 bps

• Differential in 10s still narrow at around 177 bps

• Option expiries look to help contain USD/JPY spot, massive both sides

• Below between 159.00-75 total $2.4 bln, above between 160.00-25 $1.1 bln

• Japanese exporter sales to continue to help cap, absorb importer demand

• Month-end flows also seemed to favour JPY buy-backs, helped cap upside

• Word from US TsySec Bessent, Japan FinMin Katayama meeting eyed

• Bessent earlier said he expects Japan to take action to boost yen

• Related comments , , also

• US markets , , ,

• On Bessent-speak , for more click on [FXBUZ]

USD/JPY daily:


USD/JPY hourly:

(Haruya Ida is a Reuters market analyst. The views expressed are his own)

• AUD/USD +0.2% from Mon 0.71515 low despite flaring U.S.-Iran hostilities

• Brent crude +3.0% to $90.75 a barrel, DXY down 0.3%, 30Y UST yields +4 bps

• AUD needs 0.7210 break to resume uptrend, below 0.7100 would swing narrative

• AUD Q2 current account due Tue, Q2 real GDP due Wed (poll +0.3% q/q)

• RBA's Sarah Hunter & Dr James Bishop appear before Senate Committee Thur

• U.S. Aug non-farm payrolls due Fri, Reuters poll consensus +55k

• Overnight range 0.71555-70 support 0.6920 0.6866, resistance 0.7210 0.7282
AUD Daily 21/100/200-DMA

(James Connell is a Reuters market analyst. The views expressed are his own.)