Europe

The Euro was weighed down as markets await U.S consumer price inflation data and the lack of economic releases in the bloc. The 18-nation currency slid 0.2% to $1.3501, moving closer to its 5-1/2 month trough of $1.3495 hit last week. It traded little changed at 137.0647 Yen. Investors are also waiting for Markit PMI figures due later this week for clues of current developments in the Euro-zone, especially given growing concerns that the bloc’s economy is starting to slow down. Any negative surprises could send the single currency to its lowest level so far this year.

Sterling edged lower versus the Greenback before the release of Consumer price inflation data and Wednesday’s BoE minutes. The Pound eased slightly at $1.7068, down 0.6% from its 6-year peak touched last week. The currency may depreciate further if the U.S CPI figures prints the widely expected 2.1% reading. Against the common currency, it jumped 0.2% to 1.2657 Euro, its highest level since Jul.17, when it touched a 23-month high of 1.2675 Euro. The Pound was little moved at 173.1799 Yen, after climbing as much as 0.2% in early hours. Traders are also eyeing the minutes released tomorrow in which any sign that committee members are moving towards a rate hike could give a massive boost to the currency.

North America

The U.S Dollar edged up ahead of the consumer prices data later in the day. The Labour Department is expected to report that the inflation remained at an annual pace of 2.1% in June, matching May’s figure that was the most since October 2012. The Greenback added 0.2% to $1.3501 and if the US CPI ticks up there could be a significant move up in the currency. Against its Japanese peer, it added 0.1% to 101.4944 Yen, moving away from its 5-1/2 month trough of 101.1213 Yen hit last week.

Around the world

The Yen weakened versus the majority of its most traded peers as investors’ appetite for risk slowly returned. Japan’s currency was also pressured by a slightly lowered growth forecast by the government for the current fiscal year due to a drop in demand after the April sales-tax hike. It fell as much as 0.2% before standing at 137.0647 per Euro, little moved from yesterday’s close. It climbed to 136.7454 on Jul.17, a level unseen since mid-November 2013. Against the U.S Dollar, it traded 0.4% away from its 5-1/2 month high hit on Jul.17. It last fetched 101.4944 per Dollar, down 0.1% from late U.S trade.

Meanwhile, Australia’s Dollar strengthened following RBA Governor Glenn Stevens’ speech where he tried to sound moderately optimistic. Stevens said that he was content with the current monetary policy setting and that the central bank was ready to do more if needed. The so-called Aussie erased earlier losses and last stood at $0.9392, up 0.2% from yesterday after dropping to $0.9362 earlier today on expectations that Stevens would have reiterated his previous statement. After his last comments that the Australian Dollar was overvalued, it has been keeping below the $0.94 mark. It fell as low as 69.22 Euro cents before trading at 69.51 cents, up 0.3% from late U.S hours. Against its Japanese peer, it climbed to a 1-week high at 95.3799 Yen and last stood at 95.3561 Yen, up 0.3% from yesterday’s close.

New Zealand’s Dollar tumbled before the release of US consumer prices for June, amid speculation inflation in the world’s biggest economy may have accelerated enough to bring forward the timing of interest rate hikes. The Kiwi fell 0.2% to $0.8676 and was down 0.15% to 64.17 Euro cents. Against Japan’s currency it inched down 0.1% to 88.0358 Yen. Market participants are also eyeing RBNZ review of the official cash rate on Thursday, where policymakers are expected to hike the rates by  a quarter point to 3.5%.

Interbank Rates

GBP/EUR    1.26506
GBP/USD    1.70646
GBP/JPY    173.195
EUR/USD    1.34892
EUR/JPY    136.907
USD/AUD    1.06537
USD/CAD    1.07438
USD/NZD    1.15366
USD/JPY    101.494