The dollar held steady against the euro and sterling on Friday as Treasury, bund and gilts yields all retreated in similar fashion from this week's highs, while USD/JPY fell as less limber JGB yields were only modestly lower and risk-off flows favored the haven yen more broadly.
The pullback in yields was likely helped along by 10-year Treasury yields on Thursday failing to trade above 2022's post-pandemic and GFC highs at 4.338%, encouraging profit-taking by shorts ahead of the weekend and next week's Jackson Hole symposium.
Meanwhile, investors are weighing the extent of against government stimulus efforts that so far appear insufficient.
EUR/USD was flat after it eked out new trend lows, but held just above the June 30 swing low support.
It's unlikely the market will put much stock in .
The market continues to favor a final 25bp ECB rate hike before a very gradual retreat.
USD/JPY fell 0.45% in line with sliding Treasury-JGB yield spreads.
Friday's session sent a warning to bulls by snapping a string of eight straight sessions of higher lows and highs that had left USD/JPY overbought.
Large 145 options expiries over the next week may cushion the correction, but.
Sterling traded flat, having recovered from the earlier slide on the bigger-than-forecast drop in UK retail sales.
Febrile UK inflation indicators .
Even with Chinese state banks reported supporting the yuan,.
AUD/USD was marginally higher, recovering after hitting its lowest level since November on Thursday.
USD/CAD traded at its highest since June 1 before finishing near flat.
U.S existing home sales on Tuesday is the next event risk prior to Wednesday's global August PMIs, followed by Jackson Hole events later in the week.
For more click on FXBUZ