The Pound Sterling fell by some 0.11% and hit a three-week low against the Greenback on Wednesday, even though the US Dollar Index (DXY) is in red territory, following US jobs data that were below estimates but signalled some cooling in the labour market.

The Bank of Canada (BoC) left its overnight interest rate unchanged at 2.25%, as widely anticipated, but delivered a more cautious message as inflation risks increased and the recovery became harder to assess.

Societe Generale strategists highlight that the Indian Rupee’s (INR) strong start to September is reflected in a move back below the 100dma, raising questions about whether Reserve Bank of India (RBI) intervention has helped the currency turn a corner despite a hawkish Fed and higher Oil prices.

Scotiabank strategists Shaun Osborne and Eric Theoret note EUR/USD has slipped to the upper 1.15s, with sentiment turning bearish despite supportive yield spreads. They link the renewed deterioration to rising Oil prices and concerns over Euro area terms of trade.

Brown Brothers Harriman’s (BBH) Elias Haddad notes AUD/USD fell toward 0.7125 on broad US Dollar (USD) strength, even as Australia’s Q2 GDP beat expectations at 0.4% q/q and 2.1% y/y.

The Euro tumbles against the Japanese Yen on Wednesday amid growing speculation that Japanese authorities might intervene in the FX markets, as most related Yen pairs collapsed to fresh two-week lows, with the EUR/JPY bottoming at around 183.64, after reaching a high of 185.75.

GBP/JPY falls nearly 1% on Wednesday as the Japanese Yen (JPY) strengthens across the board. At the time of writing, the cross trades around 214.43 after hitting an intraday low near 213.70, its lowest level since August 10.

ING’s Chris Turner highlights growing headwinds for the Euro as higher energy prices and a more hawkish Federal Reserve push EUR/USD lower.

USD/CAD falls to around 1.3875 on Wednesday, down 0.15% on the day, following the Bank of Canada’s (BoC) monetary policy decision. The Canadian Dollar (CAD) strengthens against the US Dollar (USD) after the central bank leaves its policy rate unchanged at 2.25%, in line with market expectations.

UOB’s Lee Sue Ann notes that the Reserve Bank of New Zealand (RBNZ) raised the Official Cash Rate (OCR) to 2.75% and kept a tightening bias, stressing the need to prevent fuel-driven inflation from becoming entrenched.

The Japanese Yen (JPY) outperforms its major peers on Wednesday, with USD/JPY falling nearly 0.90% on the day as hawkish Bank of Japan (BoJ) expectations support the Japanese currency.

Brown Brothers Harriman’s (BBH) Elias Haddad observes USD/JPY testing 160.00 as hawkish Bank of Japan comments briefly supported the Japanese Yen (JPY).

EUR/USD consolidates its daily losses during American trading hours on Wednesday as the US Dollar (USD) holds firm, supported by hawkish Federal Reserve (Fed) expectations and escalating tensions in the Middle East.

BNY’s Geoff Yu notes that Canadian Dollar (CAD) positioning remains weak ahead of the Bank of Canada (BoC) decision, with USD/CAD dominating flows and cross-currency activity surprisingly limited.

Brown Brothers Harriman’s (BBH) Elias Haddad reports the New Zealand Dollar (NZD) underperformed after the Reserve Bank of New Zealand (RBNZ) delivered a 25 bps hike to 2.75% but signaled reduced need for further tightening.

ING’s Chris Turner notes that USD/JPY is slightly lower after BoJ hawk Hajime Takata signalled the possibility of a 50bp September hike or back-to-back moves.

EUR/GBP edges higher on Wednesday, extending its advance for the third consecutive day. At the time of writing, the cross trades around 0.8585, close to the upper boundary of the narrow consolidation range that has been in place since late July.

Commerzbank’s Michael Pfister expects the Bank of Canada to hold its key rate at 2.25%, a move he says is fully priced with only a small chance of a hike.

BNY’s Geoff Yu reports that European Central Bank (ECB) Governing Council member Joachim Nagel has strongly signaled a September rate hike as Eurozone inflation stays above target and activity proves resilient.

USD/JPY retreats on Wednesday and trades around 159.65 at the time of writing, down 0.33% on the day.

USD/CAD has staged a rebound from recent lows near 1.3730 as markets digest a steady policy stance from the Bank of Canada (BoC) amid renewed United States (US)-Canada trade friction.

The Swiss Franc (CHF) extends its decline against a stronger US Dollar (USD) on Wednesday, and is nearly 0.9% down in the last two days.

NZD/USD plunges 1.45% on Wednesday, trading around 0.5810 at the time of writing, as the New Zealand Dollar (NZD) comes under heavy selling pressure despite an interest-rate hike from the Reserve Bank of New Zealand (RBNZ).

Societe Generale strategists see 1.3990/1.4030 as a key short-term resistance zone for USD/CAD following its rebound from 1.3730. They argue that a failure to break above this area could keep the broader decline intact, with 1.3840 as initial support.

MUFG’s Lee Hardman reports that the New Zealand Dollar fell sharply after the RBNZ delivered a second 25bps hike but signalled a cautious, gradual path for future tightening.

The Bank of Canada (BoC) is widely expected to keep its policy rate unchanged at 2.25% on Wednesday. This would be the seventh consecutive gathering with the central bank sitting on the fence.

The Euro (EUR) is trading lower against the US Dollar (USD) for the second consecutive day on Wednesday, weighed by risk aversion amid growing tensions in the Middle East, while rising bets of Federal Reserve (Fed) interest rate hikes support speculative demand for the US Dollar.

The British Pound (GBP) is down 0.1% to near 1.3500 against the US Dollar (USD) during the European trading session on Wednesday.

USD/CAD extends its gains for the second consecutive day. trading around 1.3940 during the European hours on Wednesday. The technical analysis of the daily chart indicates the pair is positioned above the descending channel top, signalling a bullish reversal.

ING’s Francesco Pesole expects the Bank of Canada to keep rates on hold at 2.25%, seeing very low risk of a surprise hike despite firmer headline Consumer Price Index (CPI) and solid growth.