Pip Diddy

Risk aversion prevailed and commodities were retreating during today’s morning London. As a result, the higher-yielding Aussie and Kiwi both got whupped. Meanwhile, the safe-havens got some love, particularly the yen.

The dollar gained more ground against its counterparts, as Asian session forex traders gear up for the upcoming FOMC meeting minutes.

What a comeback! After its sharp selloff in the earlier session, the Greenback rebounded against its most of its peers when Fed officials gave rate hike hints and data came in mostly upbeat.

Greenback weakness persisted during the morning London session while the recovery in oil prices gave the Loonie a nice boost. The pound, meanwhile, jumped higher on positive inflation data.

Risk-taking took a turn in the middle of the Asian session, as forex traders took profits ahead of this week’s top-tier reports.

A combination of risk-taking and downbeat economic data dragged the safe-haven U.S. dollar lower against most of its counterparts, except for the British pound and Japanese yen.

The forex calendar was almost empty and some of the major European markets were closed for a holiday (and it’s Monday to boot), so price action was relatively tight during today’s morning London session. Pound pairs were moving lower, though.

High-yielding currencies took a step back during the Asian forex trading session, thanks to tight trading conditions and mixed risk sentiment.

It looks like pound weakness was this week’s main theme. Other than that, we’ve also got Loonie strength as a major theme. So, what was driving forex price action this week?

Volatility was relatively more subdued than usual during the morning London session, as forex traders waited for the release of Uncle Sam’s retail sales report. There was some directional movement, though.