Technicals

The Dollar edged up to a one-week high versus a basket of major currencies on Monday, on speculation that comments from G8 officials could push Oil prices further away from last week's record highs. The Greenback also continued to benefit from a neutral European Central Bank tone, which reduced expectations of further rate hikes after last Thursday's move to 4.25%, and from a US jobs release that was not as weak as some had expected.

Oil hit 145.85 high on Thursday ahead of G8 meeting in Japan. Crude prices show a close negative correlation with the Dollar because the United States is a heavy energy.

On Friday (US holiday), EurUsd was up 0.13% to 1.5707. UsdJpy was fairly unchanged at 106.81 +0.09%. UsdChf went 0.13% lower at 1.0255. GbpUsd was unchanged at 1.9826 in light trading.

Several Fed officials are slated to speak this week, starting with San Francisco Fed President Janet Yellen later on Monday. Fed Chairman Ben Bernanke will speak at a Federal Deposit Insurance Corp forum on Tuesday and before the House Financial Services committee on Thursday, although he is expected to confine his comments to financial market regulation.

Investors have started to take the view that risks to growth and concern about the financial sector will prevent the Fed from raising the fed funds rate from 2% for now. However, markets are still pricing in a 25bp rise before the end of the year.