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ING’s Frantisek Taborsky highlights a busy Central and Eastern Europe calendar with Czech inflation, Turkey’s inflation report and key Polish data, including GDP and core inflation. He notes CEE assets remain driven by global headlines, higher Oil prices and narrowing rate differentials, with EUR/CZK in focus after closing above 24.250 and seen with upside risk toward 24.300.

Global factors steer regional FX

"Outside Romania’s busy calendar, the rest of the CEE week brings final Czech inflation on Tuesday, with headline CPI expected to be confirmed at 1.7% and the focus on core inflation, which we see unchanged around 2.8-2.9%."

"On Thursday, Turkey’s central bank will publish its inflation report, while Poland will release final CPI, likely confirming 3.0%, alongside 2Q GDP. We estimate Polish GDP growth accelerated to 3.8% YoY from 3.5% YoY in 1Q26, despite a further slowdown in private consumption, as investment growth gained momentum."

"CEE markets remain mainly driven by global headlines. With no progress in US-Iran talks over the weekend, we expect a mixed open, especially after Friday’s regional rates rally following US jobs data."

"Higher oil prices could trigger some correction, while last week’s narrowing in rate differentials may put pressure on CEE currencies this morning. EUR/CZK remains in focus after closing above 24.250 on Friday, in line with our post-Czech National Bank meeting call, though we still see upside risk closer to 24.300."

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Societe Generale strategists highlight that EUR/USD has squeezed above key resistance as Dollar weakness follows softer United States (US) employment data and reduced odds of a September Fed hike. The pair is seen slightly expensive versus nat gas but near fair value on 2-year spreads. They note that if the European Central Bank (ECB) hikes again while the Federal Reserve (Fed) pauses, EUR/USD could gain further, with the next resistance zone identified around 1.1610/1.1625.

Euro prospects improve as Fed bets are repriced

"Clouds first appeared on the horizon for the dollar two weeks ago after the coordinated FX intervention in USD/JPY and the squeeze in EUR/USD above key resistance at 1.1475/1.15."

"The pricing for a hike in September has been whittled back to less than 50% vs 72% at the end of July. "

"After months of obsessing about above target CPI and PCE inflation, and levelling accusations of being behind the curve, the employment situation put the Fed outlook in a different daylight and raises questions for the direction of the bond and FX markets in 2H."

"The pair trades close to fair value based on 2y spreads but is a smidgen expensive relative to nat gas."

"If the ECB hikes again and the Fed stands pat because of the deteriorating labour market, perspectives will emerge for a stronger EUR/USD ahead."

"We identify the next hurdle at 1.1610/1.1625."

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Brown Brothers Harriman’s Elias Haddad notes that the Australian Dollar (AUD) remains one of the most attractive G10 currencies thanks to favorable carry and a hawkish Reserve Bank of Australia (RBA). The RBA is expected to keep rates at 4.35% while reiterating its readiness to hike if needed, with futures pricing about a 50% chance of one more 25 bps increase by year-end.

RBA stance underpins Australian Dollar carry

"Favorable interest rate carry in Australia and Norway continue to make AUD and NOK two of the most attractive currencies across the majors. NOK and AUD rank first and second, respectively, on the G10 FX leaderboard year-to-date."

"The RBA is widely expected to keep the policy rate at 4.35% for a second straight meeting (Tuesday). The RBA is also poised to reiterate that it’s prepared to “increasing the cash rate further if needed” because inflation continues to exceed 3.0%."

"The RBA’s August Statement on Monetary Policy will shed light on the bank’s inflation and growth outlook."

"RBA cash rate futures imply about 50% odds of one final 25bps hike by year-end. The RBA has room to pause its tightening cycle."

"First, the RBA projects real GDP growth to be below potential over the next two years. Second, RBA cash rate at 4.35% currently sits near the top of the range of model-based estimates of the nominal neutral rate."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

Silver prices (XAG/USD) rose on Monday, according to FXStreet data. Silver trades at $64.24 per troy ounce, up 1.08% from the $63.55 it cost on Friday.

Silver prices have decreased by 9.63% since the beginning of the year.

The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, stood at 67.68 on Monday, down from 68.32 on Friday.

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Michael Pfister at Commerzbank highlights a strong Canadian labour market and improving Gross Domestic Product (GDP), Purchasing Managers' Index (PMI) and exports as signs of real-economy recovery, but warns this is fragile due to threatened US tariffs. Pfister expects a United States-Mexico-Canada Agreement (USMCA) extension to be agreed and remains optimistic that the Canadian Dollar (CAD) will appreciate over coming months, albeit with setbacks driven by US trade policy.

Stronger data but trade tensions linger

"In contrast to the US labour market, the Canadian labour market delivered a very positive surprise on Friday. While the median Bloomberg consensus forecast had predicted the creation of 20,000 new jobs, roughly 75,000 were actually created. In light of these figures, the unemployment rate also fell unexpectedly to 6.4%, its lowest level in two years, marking a decline of half a percentage point over the past three months."

"It almost seems as if the Canadian real economy is slowly recovering from the problems in its relationship with the US. However, this recovery is on shaky ground. The US president has announced new tariffs of 50% on certain Canadian goods if no agreement is reached by August 19th."

"We nevertheless continue to expect that an agreement on a one-year extension of USMCA will ultimately be reached. Although the US president regularly claims that only Canada would benefit from it, the two economies are too closely intertwined for a possible termination not causing major problems. But it is clear that any diversification by Canada away from its largest trading partner, the US, will be a lengthy process."

"We remain optimistic that the Canadian dollar will finally start to appreciate again in the coming months, but it will likely be a long road, with setbacks caused by the US president along the way."

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Deutsche Bank strategists highlight that negotiations between Iran and Oman over a new shipping framework through the Strait of Hormuz remain finely balanced, with Tehran linking any lasting arrangement to broader demands on the US. Brent Oil has rebounded from midweek lows but still ended last week sharply lower, as markets priced partial de-escalation in Middle East tensions.

Hormuz negotiations steer Oil risk

"The appointment of former Revolutionary Guard commander Mohsen Rezaee to head the Supreme National Security Council reinforces hard-line influence at the centre of decision-making, even as Iranian officials insist they are close to an agreement with Oman on a new shipping framework through the Strait of Hormuz."

"Foreign Minister Abbas Araghchi has described the talks as being in their final stages, but Tehran has stressed that any technical agreement on shipping routes would not by itself lead to a full reopening of the waterway."

"Reuters and other major outlets report that Iran continues to tie any lasting Hormuz arrangement to wider demands on the US, including sanctions relief, compensation for war damage and security guarantees."

"Investors priced de-escalation in Middle East tensions as negotiations between Iran and Oman progressed, though some of that optimism then faded as details of a potential agreement on Thursday raised questions over whether the US would accept the deal and just how free-flowing shipping through the Strait of Hormuz would be."

"Brent crude rebounded from lows of around $78/bbl on Wednesday, it still finished the week down -7.29% to $83.55/bbl (+1.29% on Friday)."

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• NZD/USD trades around 0.5895 on Monday, virtually unchanged on the day.
• Middle East tensions support the US Dollar despite signs of weakness in the labor market.
• The New Zealand central bank’s hawkish stance could limit Kiwi losses ahead of US inflation data.

NZD/USD trades around 0.5895 on Monday at the time of writing, virtually unchanged on the day. The pair consolidates below the 0.5900 level after retreating from its recent monthly high, as the US Dollar (USD) recovers some of the losses registered in the wake of disappointing United States (US) employment data.

The Nonfarm Payrolls (NFP) report released on Friday showed that the US economy unexpectedly lost 23K jobs in July. The previous month’s figure was also revised sharply lower to just 20K job additions from the 57K initially reported. The data points to a cooling labor market and initially weighed on the US Dollar by weakening the case for monetary tightening from the Federal Reserve (Fed).

However, the bearish reaction in the US Dollar fades as geopolitical tensions in the Middle East revive demand for safe-haven assets. Uncertainty surrounding the Strait of Hormuz remains elevated, while fresh attacks by Iran-backed Houthi militants against Saudi energy infrastructure keep concerns over energy supplies alive.

At the same time, higher Oil prices are reviving inflation concerns in the United States (US). Investors fear that energy-driven inflation could force the Fed to keep monetary policy restrictive for longer or even raise interest rates again. Expectations of tighter US monetary policy also help keep US Treasury bond yields elevated, providing additional support to the Greenback.

The international backdrop is also weighing on the New Zealand Dollar (NZD). Data released over the weekend showed that China’s annual Consumer Price Index (CPI) slowed to a six-month low in July, while the Producer Price Index (PPI) eased more sharply than expected. Weaker inflation in China fuels concerns about the world’s second-largest economy and weighs on antipodean currencies, including the Kiwi.

The downside in NZD/USD remains limited, however, by the hawkish stance of the Reserve Bank of New Zealand (RBNZ). The New Zealand central bank maintains a sufficiently restrictive bias to support the New Zealand Dollar and contain bearish pressure on the pair for now.

Investors now turn their attention to US inflation data due this week. The figures could provide fresh clues about the Fed’s interest-rate path as markets weigh a cooling labor market against the risk of renewed energy-driven inflation. Developments in the Middle East are also likely to remain an important driver of the US Dollar and, consequently, NZD/USD.

NZD/USD technical analysis

In the one-hour chart, NZD/USD trades at 0.5895, holding a modest bullish bias as it consolidates above the 100-period simple moving average (SMA) near 0.5879 and the 200-period SMA around 0.5863. The pair is grinding higher toward the horizontal resistance at 0.5909, while the Relative Strength Index (RSI) around 61 suggests firm but not overextended upside momentum, keeping buyers in control as long as price stays above the underlying moving average floor.

On the downside, immediate support is seen at the 100-period SMA around 0.5879, ahead of the 200-period SMA near 0.5863 and the horizontal level at 0.5860, which together define a broader demand band protecting the recent recovery. On the topside, a break above resistance at 0.5909 would open the door for a continuation of the advance, whereas repeated failure there would risk a pullback back toward the clustered supports below.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

ING’s Frantisek Taborsky says Romania’s unchanged Baa3 rating at Moody’s and prior Fitch decision should ease pressure after recent ROMGBs underperformance. He expects the National Bank of Romania (NBR) to keep rates at 6.50%, sees the first cut only in January 2027, and anticipates limited EUR/RON moves near 5.25 despite some scope for a short-term Romanian Leu (RON) rally.

Stable rating, delayed easing outlook

"Moody’s kept Romania’s rating at Baa3 with a negative outlook, following Fitch’s unchanged decision a week earlier. This should offer some relief after ROMGBs sold off by around 15bp at the long end last week, even as the rest of the region rallied."

"Today, the National Bank of Romania is expected to keep rates unchanged at 6.50%, and we see little reason for a shift in tone versus previous meetings, with our forecast still pointing to the first rate cut only in January 2027."

"EUR/RON remains anchored just below 5.25, and we expect limited movement given the NBR’s lack of room to tolerate additional inflation pressure. However, relief over the unchanged rating could support a RON rally today as buyers and carry trades return to the market."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

• EUR/CAD holds ground as Eurozone’s Sentix Investor Confidence rises in August for the first time in five months.
• Higher oil prices could lend support to the commodity-linked Canadian Dollar.
• Crude oil prices rebound due to uncertainty over reopening the Strait of Hormuz.

EUR/CAD inches higher after three days of losses, trading around 1.6120 during the European hours on Monday. The currency cross is holding its ground, driven primarily by a resilient Euro (EUR) following positive Eurozone economic sentiment.

The Eurozone's Sentix Investor Confidence data, a key indicator of investor morale, rose to 0.9 in August, marking its first positive reading in five months. Investor sentiment had previously dropped into negative territory in March with the onset of the Middle East conflict, though it showed signs of recovery by reaching -3.1 in July.

The upside potential for the EUR/CAD pair could be restrained by support for the commodity-linked Canadian Dollar (CAD) amid higher oil prices. West Texas Intermediate remains in the positive territory and is trading around $77.20 per barrel at the time of writing.

Crude oil prices rebounded as persistent uncertainty surrounds efforts to reopen the critical Strait of Hormuz. Over the weekend, Iran stated that talks with Oman to establish a safe shipping route through the strategic waterway are nearing an agreement, though Tehran cautioned that any deal would not result in an immediate reopening.

Meanwhile, regional security remains fragile; Iran-backed Houthi militants in Yemen claimed a recent attack on Saudi Arabia’s Jazan refinery, and a tanker operated by the Abu Dhabi National Oil Co. came under attack in the Strait.

Oil volatility keeps Middle East risks in focus for credit markets

HSBC Asset Management observes that a “recent pick-up in oil price volatility has kept the Middle East conflict front of mind for markets,” noting that while crude remains “the most visible channel,” the implications run deeper for corporate borrowers. The bank stresses that for credit investors “a big question” is not just the headline move in energy prices, but “how and where the disruption could lead to supply shortages across industries and supply chains,” particularly in sectors reliant on petrochemicals, fertilisers and industrial gases.

• EUR/USD holds gains at 1.1560, consolidating near seven-week highs.
• Eurozone Sentix Investors Sentiment Index rose to a six-month high in August.
• The US Dollar remains depressed as Fed tightening hopes ebb.

The Euro (EUR) ticks higher against a softer US Dollar (USD) on Monday, with the EUR/USD pair trading at the 1.1560 area at the time of writing, consolidating gains a few pips below seven-week highs at 1.1773. Fading hopes that the US Federal Reserve (Fed) will hike interest rates in September are hurting the Greenback, while, in Europe, bright investors' confidence figures have provided additional support to the Euro.

Data released by the Sentix research institute on Monday revealed that investors' confidence in the Eurozone economy improved sharply in August, reaching positive levels, with a 0.9 reading, for the first time since February. These numbers confirm a steady recovery, from -.3.1 in July and -13.4 in June.

The greatest improvement has been seen at the current economic conditions sub-Index, which rose by 6.8 points, while the economic expectations improved by a more moderate 1.0. The expectations about the German economy rose by 2.5 points to 6.0, also the highest level since February, while the Global Aggregate rose by 1.4 points, to 14.7, suggesting that economic recovery expectations are broad-based.

The Euro is drawing some support from a weaker US Dollar, as the negative surprise posted by the US Nonfarm Payrolls data has dampened hopes of immediate Federal Reserve (Fed) rate hikes further. This is offsetting concerns about the economic consequences of higher Oil prices for now, as the status of the Strait of Hormuz remains highly uncertain with sea traffic through the key waterway practically blocked.

US CPI data will be the highlight of the week

The US calendar is thin on Monday, and the focus is on the US Consumer Price Index (CPI) figures for July, due next Wednesday, for a better assessment of the Fed's near-term rate path. The market consensus points to a mild slowdown of consumer prices to a 3.4% year-on-year rate, from 3.5% in June. The Core CPI is also expected to have eased, to a 2.5% yearly growth, from 2.6% in the previous month.

Analysts at ING see the EUR/USD "firmly dominated by the USD side of the equation,” with upcoming US inflation data set to play a pivotal role. In their view, “a softer US CPI print would increase the chances of a break above 1.160 already this week,” with the “next important resistance beyond that” identified as “the 200-day moving average at 1.1630.”