USD

After posting its fourth-straight weekly gain last week, the US Dollar is pushing higher this morning and trading at a five-week high as markets digest last week's US inflation numbers and the latest concerning economic headlines out of China.  

Despite last week's PPI read coming in higher than expected, markets are still pricing in nearly a 90% chance of the Fed holding rates firm at their next meeting in September.  

Looking ahead to tomorrow, US retail sales data for July is on deck and expected to show a 0.4% monthly rise, which would be its best since April and its fourth-consecutive monthly increase.

EUR

The Euro is tumbling again this morning, fresh off its fourth consecutive losing week against the Dollar as traders scaled back bets on an ECB rate hike in September.  

Earlier today, German wholesale price data showed inflation fell by 2.8% in July, continuing a four-month decline. The drop was mainly due to lower prices for petroleum products and scrap materials, while prices for fruits, vegetables, and electronic equipment increased. Monthly prices also decreased by 0.2%, matching the trend from the previous month.

Tomorrow, the latest Eurozone ZEW Economic Sentiment Index read is slated for release, with market forecasts pointing to another slightly pessimistic outlook following three-straight months of a negative read.

GBP

The British Pound is declining against the Greenback this morning ahead of a busy week on the UK economic calendar that could provide insight into the BoE's next move after Friday's stronger-than-expected GDP print sparked renewed bets on further interest rate hikes.

At 2:00 AM EST tomorrow, the UK's 3-month unemployment rate for June is on the docket and expected to remain at 4%, the highest since Q4 2021. At the same time, the UK economy is expected to have added 50K jobs in June, which would be the lowest increase since December 2022.

Looking ahead, UK CPI and retail sales figures are also on the calendar for Wednesday and Friday.

JPY

The Japanese Yen is in the red for the sixth consecutive session, en route to setting a fresh 2023 low versus the Dollar overnight. With this morning's moves, the Yen now sits at the same level that inspired Japanese authorities to intervene in the FX market last September to prop up the currency.

JPY traders will be eager to review Japan's Q2 GDP report, scheduled for release this evening at 7:50 PM EST. Market forecasts indicate Japan's economy will have expanded 0.8% in Q2 compared to Q1, which would be its best print since Q2 2022. Meanwhile, from an annual perspective, GDP is expected to have risen 3.1%, improving from the previous read of 2.7%.

CAD

The Loonie begins the week in the red again on the heels of its sixth weekly loss out of the past seven against the Dollar. USD/CAD traders are bracing for potential volatility in the leadup to tomorrow's double dose of US retail sales and Canadian inflation data, both scheduled for release at 8:30 AM EST.

Canada's annual inflation rate is projected to rise to 3% in July after surprisingly falling to 2.8% in June. This would be the first increase in inflation since April. On the other hand, markets expect annual core inflation to cool to 2.8% from the 3.2% seen in June.  

MXN

The Mexican Peso capped off a volatile week with a strong performance on Friday and closed the week more than 0.3% higher versus the Greenback. Today, the Peso is pulling back, following the rest of LATAM lower, thanks partly to broad demand for Dollars and increased fears surrounding China's economy.

Mexico's economic calendar is empty until Friday's retail sales report, leaving MXN traders narrowly focused on tomorrow's US retail sales print and Wednesday's FOMC minutes and any developments in China's property sector that may affect global risk appetite.

BRL

The Brazilian Real is down over 0.5% this morning after posting its second-straight weekly loss last Friday as traders continue to assess the implications of Friday's hotter-than-expected Brazilian inflation print against a backdrop of global economic uncertainties.

Earlier today, Brazil's economic activity grew by 0.63% in June, according to the IBC-Br Index of Economic Activity. The result was slightly above market expectations and rebounded strongly from the 2.05% drop in May. Both the services and industrial sectors improved somewhat, but retail flatlined.

Today's economic activity report was the final data release scheduled in Brazil until next Tuesday's Federal Tax revenues are revealed.  

CNY

The Chinese Yuan is reeling this morning, down over 0.4% in the offshore market and setting a new low for 2023 as markets react to the latest headlines surrounding China's struggling property giants.

News broke earlier today that Country Garden, China's top private developer, is looking to delay bond payments and has halted trading in 11 of its onshore bonds, sending its stock price to a historic low. The report has sparked market concerns surrounding China's property sector, which has seen sales decline and developer defaults rise over the past two years.

Later this evening, China's July retail sales and industrial production reports are slated for release at 10:00 PM EST.