Ella 
Here’s what you need to know on Monday, September 11th:
Risk sentiment remained relatively firm in early trading on Monday, helped by a rebound in Chinese stocks after a pickup in inflation showed signs of tentative stabilization in the world’s second-largest economy. China’s consumer price index (CPI) rose 1.0% year-on-year in August, reversing a 0.3% decline in July.
U.S. S&P 500 futures rose 0.30% on the day, while U.S. Treasury yields rose 1% after U.S. Treasury Secretary Janet Yellen expressed “confidence in a soft landing for the U.S. economy” over the weekend.
The U.S. dollar (USD) remains tumbled, shrugging off the positive influence of U.S. Treasury yields, as risk-on flows dominate at the start of a crucial U.S. CPI inflation week. The main reason for the dollar’s decline may be related to the ongoing sell-off in the USD/JPY currency pair. The U.S. Dollar Index (DXY) retreated from a near six-month high of 105.16 and is currently trading around 104.60, down 0.40% on the day.
USD/JPY fell below a large bullish opening gap against the US dollar as Asian traders reacted to hawkish comments from Bank of Japan (BOJ) Governor Kazuo Ueda over the weekend. 147.00. Ueda said the central bank’s focus now will be on “quiet exit,” signaling a possible rate hike. USD/JPY’s losses in Asia have extended into early European trade and are now trading around 146.00, down nearly 1.20% year to date.
EUR/USD is recovering above 1.0700, having hit a three-month low of 1.0686 last Thursday. GBP/USD maintains significant gains above 1.2500 as traders await a speech from Bank of England (BOE) chief economist Huw Pill and policymaker Mann later.
AUD/USD is trading firm above the 0.6400 level, up 1% on the day, on improving inflation in China and broad dollar weakness. Meanwhile, USD/CAD has fallen below 1.3600 despite WTI prices moving sideways.
Gold prices extended recovery gains to move closer to the 50-day moving average (DMA) at $1,932, temporarily outpacing strength in U.S. Treasury yields amid continued dollar selling.
There aren’t any major data releases on the economic calendar on either side of the Atlantic, leaving currency markets at the mercy of risk trends and sentiment surrounding the U.S. dollar.
