As the week comes to a close, the US dollar is largely consolidating against most G10 currencies, with a few notable exceptions. The British pound stands out as the only G10 currency to rise today, driven by the Bank of England’s (BOE) cautious stance yesterday and stronger-than-expected retail sales today. On the other hand, the Japanese yen is under pressure following the Bank of Japan’s (BOJ) decision to hold its policy unchanged, despite an uptick in the national CPI. The BOJ's lack of urgency to take further action, even as a potential move next month looms, suggests a measured approach. Meanwhile, US equities surged yesterday, bolstering Asia-Pacific stocks. Gold hit a fresh record of nearly $2,613, advancing over 1% this week after a 3.2% gain last week. November WTI crude is consolidating within a narrow range (~$70.70-$71.20) following a 1.8% increase yesterday.

Asia-Pacific Markets
The Bank of Japan maintained its current policy at today’s meeting, yet reiterated its tightening bias. Signals from top BOJ officials remain consistent—barring any economic shocks, the BOJ intends to continue raising rates as long as the economy evolves as expected. The dollar’s range against the yen was established in the local session yesterday, fluctuating between JPY142 and JPY144. Today, the dollar initially dropped to JPY141.75 during Asia-Pacific trading, before recovering to near JPY144 in the European morning session.
The Australian dollar has emerged as the best performer among G10 currencies this week, up around 1.6%, as it consolidates just above $0.6800.

European Markets
In Europe, the Bank of England has refrained from cutting rates in consecutive meetings, despite the UK economy stagnating for the second straight month in July and August CPI coming in slightly below expectations. Markets are pricing in a nearly 65% chance of a 50-basis-point rate cut before year-end. Sterling reached its highest level since Q1 2022 today, nearing $1.3340.
The euro, meanwhile, has traded quietly, ranging between $1.1150 and $1.1180.

American Markets
Canada is set to release July retail sales data today, with expectations that stronger vehicle sales will lift the headline figure after a drag in June. Excluding autos, retail sales were flat in the first half of the year, with Q2 gains offsetting Q1 weakness. However, this data is unlikely to drive the Canadian dollar or influence interest rate expectations significantly. The softness in the labor market remains a key concern for policymakers, with potential for core inflation to moderate. The swaps market has priced in around 75 basis points of rate cuts for the remainder of the year, up from 64 basis points following the September 6 employment report. Next week’s highlight will be the release of July GDP figures, after June posted flat growth.