We have seen demand for the US dollar in the London fixed session all week, and that was a preview of today’s flows, as the dollar accelerated in the final fixed session of the month.
The USD/JPY pair hit a session high of 76 pips to 145.74, while the Australian dollar also fell to a session low of 0.6775. The euro and the pound were slightly higher than their previous lows.
It’s hard to make sense of market movements at the end of the month as flows outweigh fundamentals. Looking ahead, September is a weak season for riskier trades but that’s not always true for the kind of moves you’d expect in the forex market. Instead, expect a healthy dose of fundamentals to dominate, including next week’s nonfarm payrolls and interest rate decisions from all the major banks, starting with the Bank of Canada on Wednesday.
The Canadian dollar is particularly volatile today after a good GDP report. Note that Monday is a public holiday in the US and Canada, so flows in the US and Canadian dollars are particularly strong today.
USDCAD 10 minutes