French unrest drags the euro; the Aussie gains 0.51% on China's GDP

Violent protests in France weighed on the euro, and the dollar closed higher against four of the seven majors on our feed after two sessions of losses against six. The Australian dollar gained the most, 0.51%, after China's growth beat forecasts, and USD/CAD posted a third lower close in a row even though Canadian inflation came in below forecast.

What the data showed

• CAD · CPI y/y: 3.1% in September against 3.2% expected, from 3.0%, investingLive reported; m/m 0.1% against a 0.2% forecast. Action Forex said gasoline drove the rise. Our weekly wrap had cited Wells Fargo and TD Securities expecting 3.2%.

• CAD · The Bank of Canada's median measure slowed to 1.9% from 2.0% and its trimmed measure to 1.8%, below the 1.9% expected. Its business outlook survey indicator rose to −0.33 in the third quarter from −0.38, investingLive reported.

• CNY · China GDP y/y: 4.5% in the third quarter against 4.4% expected, from 4.3%, and retail sales 1.1% against 0.5%, investingLive reported.

France, yields and the dollar

• The euro opened lower on escalating riots in France, among other worries, and recovered most of the gap in Asian hours, investingLive said. Action Forex had French yields eyeing 5%, and Scotiabank said the protests widened French spreads over Germany. EUR/USD dipped to 1.11806 at 21:10 UTC on Sunday, minutes after the open, peaked at 1.12347 at 04:38 and closed at 1.12117, down 0.25%: back below 1.1215 after two closes above it.

• The dollar closed higher against the euro, the pound, the yen and the Swiss franc, and lower against the Australian, New Zealand and Canadian dollars. FXStreet said it regained some composure after two daily drops, helped by rising US Treasury yields and the French concerns; earlier, Investing.com had those yields easing near one-month lows. FXStreet also had bets on an October Federal Reserve hike easing while December stayed firmly priced.

The Aussie, the loonie, oil and gold

• AUD/USD rose 0.51% to 0.69794, the biggest gain of the seven against the US dollar, after a high of 0.69929 at 14:18 UTC. Action Forex said the Australian and Canadian dollars led on separate catalysts rather than a broad risk-on rally, the Aussie on China's data and on reduced conviction that Reserve Bank of Australia tightening has finished. Assistant Governor Christopher Kent questioned whether policy is restrictive enough after four hikes this year, the same source reported.

• USD/CAD traded below 1.4081, the retracement level Action Forex flagged, only in the 11:00 and 12:00 UTC hours, with a low of 1.40706 at 11:49, and rose off its lowest since 23 September on the CPI release, FXStreet said. It closed at 1.41116, down 0.17%: a third lower close in a row and its lowest close on our feed since that date. It never traded above the 1.4140 fair value Scotiabank cited in our weekly wrap. TD Securities saw limited scope for a sustained Canadian dollar rally.

• WTI fell early after the US waived Russia oil sanctions, then turned higher in the US afternoon on unconfirmed reports of new US strikes on Iran and climbed back above $99, its highest since 16 September, FXStreet said. The same source said that rise in oil lifted US yields and gold sagged. On our feed gold peaked at $4,190.33 at 07:33 UTC and closed at $4,142.27, down 0.64%, its 16th close in a row below $4,200, with most of the fall in before oil turned.

• USD/JPY rose 0.34% to 158.511. Bank of Japan Governor Kazuo Ueda said underlying inflation was quite close to the 2% target, Action Forex reported, yet FXStreet said the yen struggled against most majors despite the bank's hawkish signals.

• The pound slipped 0.18% to 1.33042. It touched 1.3342 at 11:22 UTC, a pip above the 1.3341 where Action Forex says a sustained break would raise the chance of a bullish reversal, and closed below it, as on Friday. Brown Brothers Harriman (BBH) said markets already price a 25 basis-point Bank of England hike to 4.00% in November and 100 basis points over twelve months, a path it saw as over-priced.

Market gauges and what's next

Our proprietary metrics at the close of the session:

• Readings: an MRS of 81, level with Friday, with its news component at its full 20. A CTS of 54 with its carry backdrop at 60 out of 100, and an FSI of 56, Neutral, from 58.

• Top of our strength table: the Swiss franc, first for 306 of the session's 1,437 minutes, 21% of them, a clear lead. The yen was second, on 272.

• Bottom: no currency clearly trailed.

• The franc and the yen: the table counts minutes in each place, not the session's net move. The two spent the most minutes on top on a day the dollar gained 0.34% against each, and FXStreet said policy divergence between the Fed and the Swiss National Bank (SNB) favoured the dollar against the franc.

• Last week's test: EUR/USD stayed between the two lines our weekly wrap set, 1.1276 above and 1.1111 below, for the whole session, so the tell is still open.

Today: UK average earnings are due at 06:00 UTC, with a forecast of 3.8% from 3.9%, and Action Forex flagged Tuesday's French budget vote.