Bank of England (BoE) Deputy Governor Dave Ramsden said on Monday that risks to the inflation outlook have become increasingly tilted to the upside, according to Reuters.

Kit Juckes at Societe Generale notes that EUR/USD forecasts have been repeatedly revised down as Dollar strength persists. While consensus has moved from 1.20 to 1.16 and Societe Generale now sees 1.15, client discussions suggest markets are even more Dollar-bullish.

Deutsche Bank’s Jim Reid notes that global equities, including the S&P 500, held up well despite a notable rise in bond yields and hawkish rate expectations. The S&P 500 gained over 1% on the week and remains close to record highs, supported by optimism on growth and strong PMI data.

Societe Generale’s Kit Juckes argues that while the longer-term outlook for the Dollar is deteriorating due to US politics and changing global savings patterns, the short-term picture remains constructive.

Rabobank’s RaboResearch Global Economics & Markets team flags potential historic tightening by the Bank of Japan (BOJ). Former BOJ director Momma sees another 25 basis point hike as a real possibility, which would be the first back-to-back move in decades.

Japan's top currency diplomat Atsushi Mimura said on ​that markets should take at face value the "very ‌clear" message Tokyo and Washington delivered last week on the Yen, signalling his resolve to act against excessive falls ​in the currency, Reuters report.

The US Dollar Index (DXY), which measures the value of the US Dollar (USD) against six major currencies, inched lower after opening at a bullish gap, remaining in the positive territory and trading around 101.10 during European hours on Monday.

RaboResearch Global Economics & Markets notes the Reserve Bank of Australia (RBA) must decide on policy with strong construction growth and historical parallels to past Oil shocks and inflation spikes.

Societe Generale’s Kenneth Broux describes a difficult week for global bonds as rising Oil prices deter duration buying. US Treasuries and Bunds have repeatedly broken into higher yield ranges, with next US 10-year projections at 5.24% and 5.36% and Bund at 3.70%/3.74%.

EUR/CAD extends its gains for the third consecutive day, trading around 1.6110 during the European hours on Monday.

Italy Trade Balance non-EU down to €2B in August from previous €2.55B

Austria UniCredit Bank Manufacturing PMI climbed from previous 54.4 to 54.9 in September

MUFG’s Lloyd Chan warns that the Indonesian Rupiah remains exposed as US yield increases erode Indonesia’s rate support.

DBS Group Research strategist Sherilyn Chew contrasts India’s domestic backdrop with Indonesia, arguing India is deeper into a tightening phase. Markets are pricing a possible Reserve Bank of India (RBI) hike in October, with liquidity surplus falling after RBI draining measures.

USD/IDR recovers its recent losses from the previous trading day, trading around 17,980 during the Asian hours on Monday.

Asian equities mostly trade in negative territory on Monday, pressured by rising oil prices and higher US Treasury yields. Traders doubt that the United States (US) and Iran will reach a ceasefire agreement soon. 

Singapore Industrial Production (YoY) climbed from previous 6.8% to 15.4% in August

Singapore Industrial Production (MoM): -0.5% (August) vs previous 2.3%

Gold prices fell in India on Monday, according to data compiled by FXStreet.

Gold (XAU/USD) attracts fresh sellers at the start of a new week and weakens below the $4,200 mark, hitting its lowest level since August 5 during the Asian session amid a bearish fundamental backdrop.

China’s Commerce Ministry said on Monday that the United States (US) and Chinese officials confirmed that the bilateral trade truce has been extended by two months, moving the expiration date from November 10 January 10, 2027. 

Japan Corporate Service Price Index (YoY) increased to 3.7% in August from previous 3.6%

US President Donald Trump said on Sunday that he believes the war with Iran will be won “very soon,” adding that additional military strikes before the midterm elections are possible, Fox News reported. 

The Bank of Japan (BoJ) board members shared their views on the monetary policy outlook on Monday, per the BoJ Minutes of the July meeting.   

UOB’s Quek Ser Leang and Lee Sue Ann describe USD/CNH as consolidating after a move to 6.7200, with momentum slowing in the very near term.

US Treasury yields turned mixed on Friday as the long-end of the curve, the 20s and 30s, posted gains while the short-end and the belly of the yield curve retreated to multi-year high levels. The US 10-year Treasury yield holds firm at 5.20% after peaking at a 19-year high of 5.228%.

ING’s Asia-Pacific research notes that South Korea’s upcoming data should show stronger industrial production and a widening trade surplus, even as export and import growth moderates. Technology and semiconductor exports are expected to underpin the surplus.

United States CFTC Gold NC Net Positions: $225.9K vs previous $230.3K

United Kingdom CFTC GBP NC Net Positions: £-82.6K vs previous £-58.7K

United States CFTC S&P 500 NC Net Positions down to $-133.2K from previous $-100.5K