EUR/USD has fallen toward 1.136, its weakest level since late July. The ECB’s recent rate increase has provided limited support as the widening US yield advantage continues to favor the dollar. Attention now turns to German inflation and retail sales data for further clues on the European outlook.

Energy markets have again become the main geopolitical risk. Oil rose for a second session after Washington rejected Iran’s latest proposal concerning the Strait of Hormuz, while continued regional tensions threaten supply routes. Brent’s November contract moved above $106, although later-dated prices remain lower, reflecting uncertainty over how long disruptions will persist.

Gold is attempting to recover after falling to a seven-week low, trading near $4,144 as higher yields and Fed tightening expectations offset demand for geopolitical protection.

USD/JPY has eased toward 157 as speculation grows that the BoJ could tighten again, although the broader dollar backdrop remains supportive. Meanwhile, US technology shares have weakened as higher yields pressure valuations, while Bitcoin remains near $83,000.

In China, sentiment received modest support from targeted US-China tariff reductions following the Trump-Xi summit, but major disagreements remain unresolved. China is also preparing additional economic support as domestic growth pressures persist.