The USD is starting the day higher with the JPY the biggest mover with a gain of close to 0.80% as Japan's Takaichi becomes the PM. The EUR and GBP are both down -0.22% vs the greenback. In the video above, I take a look at the technicals given the move higher in the greenback today and outline the key targets and risk defining levels.

Japan has it's first female PM after Japan's LDP leader Takaichi secured enough votes to assume the role (as expected). Takaichi leans dovish on interest-rates. She supports maintaining a loose monetary stance and expansionary fiscal policy, prioritising growth over tightening.

Incoming Japanese Finance Minister Katayama commented that it is desirable for the foreign exchange (FX) market to move in a stable manner reflecting fundamentals, making no comment when asked about potential Bank of Japan (BoJ) interest rate hikes. This sentiment reiterates recent commentary from the outgoing Finance Minister, Kato, who also declined to comment on specific FX levels but noted recently seeing one-sided, rapid moves and emphasized the importance of stability reflecting fundamentals.

Meanwhile Bloomberg, suggests the Bank of Japan is closer to a rate hike, but that there is little need to rush and no urgency to hike rates next week. Current market pricing for a 25 basis point (bps) hike is for a 20% chance next week with a 44.8% chance in December.

The Canada CPI will be released at 8:30 AM with the expectation for 0.0% for the headline MoM and 2.3% up from 1.9% last month.

Source: Investing Live