The market reacted to the latest US jobs data, interpreting it as relatively strong, which bolstered the dollar and US interest rates. The recent EU Parliament elections have caused significant political upheaval in Europe. Thin trading in the Asia Pacific region, due to holidays in China, Hong Kong, Taiwan, and Australia, saw the euro decline to a one-month low, slightly below $1.0740, during the European morning session. The dollar has shown general strength against G10 and emerging market currencies.

Asia Pacific Markets
The week began with markets reacting to last Friday's US jobs report and the EU Parliament elections. Markets in China, Hong Kong, Taiwan, and Australia were closed today for national holidays. Key events this week include Australia's May employment report tomorrow, the Bank of Japan's meeting conclusion, and China's CPI release on Friday.
Rising US rates have supported the dollar's recovery. The greenback reached nearly JPY157.10 ahead of the weekend before settling around JPY156.75.
The Australian dollar broke out of its $0.6600-$0.6700 range, recording a marginal new low near $0.6675 today.

European Markets
With the ECB's rate cut last week and market sensitivity to upcoming US CPI and FOMC meetings, eurozone economic factors are taking a backseat this week.
The UK will report employment data tomorrow, followed by April GDP details on Wednesday.
The euro has dipped in Europe to slightly below $1.0740, with the next support level expected around $1.0700-$1.0720.
Sterling fell by a cent after the US jobs data, touching the 20-day moving average at $1.2690 in European trading.

American Markets
The resilience of the US labor market allows the Fed to take more time to confirm that inflation is moving toward its target.
In contrast, Canada's labor market is slowing more significantly, reinforcing the expectation that the Bank of Canada might implement another rate cut before the Federal Reserve.
The US two-year yield premium over Canada increased by 20 basis points last week, reaching nearly 90 basis points—the highest since 2005. With the dollar closing above CAD1.3750 for the first time since the end of April, there is little technical resistance to reaching CAD1.3785-CAD1.3800 initially, and potentially the year's high from mid-April near CAD1.3850.