The Swiss Franc (CHF) pares recent gains against the US Dollar (USD) on Monday, as fresh frictions in the Middle East are dampening investors’ appetite for risk in an otherwise calm market session.

NZD/USD trades around 0.5680 at the time of writing, down 0.50% on the day as the New Zealand Dollar (NZD) remains under pressure against a stronger US Dollar (USD).

MUFG’s Lee Hardman notes that the Japanese Yen (JPY) has weakened again, pushing USD/JPY back above 162.00 and coinciding with further selling at the long end of the JGB curve.

BNY’s Geoff Yu argues that European disinflation is allowing focus to shift from emergency inflation control toward growth and fiscal credibility.

Eurozone Retail Sales rises at a moderate pace of 0.2% Month-on-Month (MoM) in May against the estimates of 0.3%. In April, Retail Sales, a key measure of consumer spending, declined by 0.4%.

Eurozone Retail Sales (MoM) registered at 0.2%, below expectations (0.3%) in May

Eurozone Producer Price Index (YoY) above forecasts (5.7%) in May: Actual (5.9%)

Eurozone Retail Sales (YoY) meets expectations (1.6%) in May

Eurozone Producer Price Index (MoM) meets forecasts (0.2%) in May

Societe Generale strategists note USD/JPY has pulled back after testing resistance near 162.80 but is still holding above the March peak around 160.40.

The Euro (EUR) shows a moderately negative stance against the US Dollar (USD) on Monday, in a calm start of the week.

United Overseas Bank’s (UOB) Quek Ser Leang highlights that EUR/USD remains in a short-term range, with flat momentum indicators pointing to intraday consolidation between 1.1415 and 1.1455.

Eurozone Sentix Investor Confidence increased to -3.1 in July from previous -13.4

The Australian Dollar (AUD) is trading moderately lower against the US Dollar (USD) on Monday, as cooler Australian inflation figures have eased pressure on the Reserve Bank of Australia (RBA) to hike interest rates further.

The GBP/JPY cross gains strong follow-through positive traction for the second successive day and rallies to mid-216.00s during the early European session on Monday, back closer to a multi-year peak set in late April.

ING’s Chris Turner highlights a sizeable downside breakout in EUR/GBP driven by stale Sterling shorts and lower FX volatility reducing appetite to pay carry.

Commerzbank notes that USD/INR eased 0.2% on Friday to 95.20 but still gained 0.9% over the week, remaining within a 94–96 range.

Here is what you need to know on Monday, July 6:

United Overseas Bank’s (UOB) Quek Ser Leang reports AUD/USD has stalled after last week’s sharp rise, with a tentative build-up in downside momentum pointing to a limited dip toward 0.6910 intraday. For the next 1–3 weeks, the bank stays neutral, expecting consolidation between 0.6870 and 0.6980.

BNY’s Geoff Yu expects the Reserve Bank of New Zealand (RBNZ) to raise the Official Cash Rate (OCR) by 25bp to 2.50%, supported by stronger Gross Domestic Product (GDP), resilient labor markets and firm inflation near the top of target.

The USD/CAD pair is seen building on last week's bounce from the vicinity of mid-1.4100s and gaining positive traction for the second consecutive day on Monday.

USD/JPY gains ground for the second successive day, trading around 162.20 during the early European hours on Monday. The currency pair is maintaining a bullish near-term bias as it holds comfortably above both the nine-day and 50-day Exponential Moving Averages (EMAs).

MUFG’s Teppei Ino reviews recent USD/JPY price action, noting the pair opened near 161.78 and briefly tested the 162.84 area before reversing. The report highlights Dollar weakness after comments from Fed Chair Kevin Warsh and a softer US employment report.

The British Pound (GBP) ticks lower against the  US Dollar (USD) Monday, attempting to close a seven-day rally, as tensions rise again in the Strait of Hormuz, one of the critical points in the peace process between Washington and Tehran.

The Swiss Franc (CHF) faces selling pressure against the US Dollar (USD) at the start of the week. The USD/CHF pair is down 0.25% to near 0.8055 during the European trading session as the US Dollar rebounds despite traders reconsidering Federal Reserve (Fed) interest rate hike expectations.

United Overseas Bank’s (UOB) Quek Ser Leang notes GBP/USD remains elevated after last week’s surge, with scope for a modest pullback confined to 1.3320–1.3375 intraday and limited risk of a clear break below 1.3320.

Commerzbank’s Michael Pfister argues that recent EUR/USD weakness reflects a stronger US Dollar (USD) rather than a fundamentally weak Euro (EUR), as the Euro has outperformed the G10 average.

The EUR/USD pair trades marginally lower to near 1.1428 during the early European trading session on Monday. The major currency pair faces slight selling pressure as the US Dollar (USD) gains ground after a negative weekly close.

The Indian Rupee (INR) opens marginally lower against the US Dollar (USD) at the start of the week.

The USD/JPY pair builds on its goodish recovery from the 160.50-160.45 region, or over a two-week low touched on Friday, and gains strong follow-through traction for the second straight day on Monday.