Monday Overview

The US dollar is mostly lower, surrendering some of its pre-weekend gains, against most of the major currencies. Sterling is the notable exception. It is heavy in the wake of a drop Righmove’s house price index, for the third consecutive month and some mortgage and money supply data (M4 contracted by 0.2%).

Japan’s markets were closed today. The dollar continues to be confined to narrow trading ranges. Japanese exporters and margin traders are thought to be capping the greenback near JPY86, while fear of intervention is provided support near JPY85.50. The Australian dollar starts the week off with a bang, as hawkish comments by the RBA Governor keep the door open to additional rate hikes.

Global equities are generally higher. Note, however, that Chinese equites bucked the trend and the Shanghai Composite is at 5-week lows. The same hakwish RBA comments that underpinned the Aussie, weighed on share prices.

European markets are under pressure and spreads with the periphery have widened, which makes the euro's rise all the more impressive.