Forex Today: Major pairs hold steady to start new week

Major currency pairs began the new week in a holding pattern, consolidating the moves that reshaped positioning in the final sessions of last week. According to FXStreet's Monday market wrap, the US Dollar weakened against its major rivals heading into the weekend, with the US Dollar Index closing in negative territory and snapping a four-week winning streak.

The trigger for that reversal was commentary from Federal Reserve Chair Kevin Warsh. His remarks prompted investors to refrain from pricing in a potential interest rate increase at the October meeting, which in turn set off a selloff in the greenback. Repricing of near-term Fed expectations has been the dominant theme across currency markets in recent sessions, with the Dollar's direction closely tracking shifts in how aggressively policymakers are expected to act.

By the European morning on Monday, the US Dollar Index was flat below the 102.00 level, suggesting that the post-Warsh adjustment had largely run its course for the time being. The broader tone was risk-positive: US stock index futures were up between 0.4% and 1.3%, a backdrop that typically limits demand for the Dollar as a defensive holding.

Measured over the previous seven days, the Dollar was softer against all of the majors tracked in FXStreet's performance table. It was weakest against the Canadian Dollar, down 1.29%, followed by losses of 0.84% versus the New Zealand Dollar, 0.70% versus the Pound Sterling and 0.64% versus the Swiss Franc. Moves against the Euro, Japanese Yen and Australian Dollar were comparatively small, at 0.16%, 0.05% and 0.04% respectively.

The Australian Dollar was the standout performer on Monday. AUD/USD gathered bullish momentum, trading near 0.6980 and climbing roughly 0.5% on the day, with FXStreet linking the advance to a strong batch of Chinese economic data. Domestic commentary added to the picture: Reserve Bank of Australia Assistant Governor Chris Kent said there is a reasonable indication that neutral interest rates are rising both domestically and globally, while cautioning that it remains difficult to pinpoint the neutral rate amid high uncertainty.

In Asia, USD/JPY was quiet in the European morning, fluctuating within a tight channel around 158.00. Earlier in the session, Bank of Japan Governor Kazuo Ueda said that anchoring core inflation near 2% is becoming more crucial, and argued that long-term interest rates would likely rise steadily alongside policy if the BoJ raises its short-term policy rate. Those comments were read as leaning hawkish, though they did not dislodge the pair from its narrow range.

EUR/USD remained in a consolidation phase near 1.1200 after finishing the previous week marginally higher, reflecting the absence of a fresh catalyst on either side of the Atlantic at the start of the week.

Geopolitics remained a background factor. FXStreet, citing CNBC, noted that Iranian official Mohsen Rezaei warned on Sunday that Tehran has prepared a new retaliation plan in the event of any renewed US-Israeli attack, while maritime authorities reported several separate attacks on commercial vessels around the Strait of Hormuz. Developments in the region can influence energy prices and safe-haven flows, both of which feed into currency and precious-metals markets.

Attention now turns to the remainder of the week's data calendar and further central-bank commentary, which traders will use to refine expectations for the Fed's October decision.

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This is a news summary for general information only — not financial advice, and nothing here is a recommendation to buy or sell any currency or metal. Exchange rates and gold prices can move sharply around data releases and central-bank decisions, and trading them carries a real risk of loss, which leverage magnifies. Always verify against the original source and do your own research before making a financial decision.