Canadian inflation numbers came in lower than expected in June, but stayed above the Bank of Canada's 2 percent target, adding weight to the view that the bank will hike interest rates at least one more time.
Federal Reserve Chairman Ben Bernanke told Congress on Wednesday housing market woes could dampen an expected pickup in U.S. economic growth, but he restated that the central bank's main worry is inflation.
The dollar rose versus the yen for the first time in three sessions after a government report showed foreign investors bought a record amount of U.S. securities in May.
Asian shares mostly eased on Monday with South Korea retreating from record highs on fears the government may move to cool the market, while Brent crude was about $1 away from its highest level due to supply worries.
The dollar weakened against major currencies on Monday, plumbing fresh multi-year depths against higher-yielding units as bearish sentiment toward the greenback and the outlook for U.S. interest rates gripped markets.
U.S. retail sales posted their biggest monthly decline in nearly two years during June, according to government data issued on Friday, indicating the housing market slump and soaring gasoline prices are depressing consumer spending.
Consumer spending fuels about two-thirds of total economic output and a pullback could weigh heavily on an economy already pegged to grow below trend this year.
Gold rose to its highest level in more than one month on Wednesday on a weak U.S. dollar and dealers said the metal was gaining momentum to hit new highs.
Swings in volatile energy and food prices will have minimal impact on inflation as long as expectations of future price gains are held steady, Federal Reserve Chairman Ben Bernanke said on Tuesday.
Employers added 132,000 jobs in June and payrolls rose more strongly than previously thought in April and May, according to a Labor Department report that underlined a strengthening job market.
Current U.S. interest rate policy should promote a further drop in inflation although risks are still skewed toward higher prices, San Francisco Federal Reserve President Janet Yellen said on Thursday.
Zimbabwe authorities ordered businesses on Thursday to stop selling basic goods in bulk to avert shortages after an official price freeze triggered a frenzied buying spree that has emptied most shop shelves.
Gold edged higher on Wednesday to trade just above a key level of $650 an ounce, but business was very low key because of a holiday in the United States.
British house price inflation remained in double-digits in June and prices in the service sector accelerated, according to two separate surveys on Wednesday that reinforced expectations interest rates would go up this week.
Security concerns and a sharp drop in the dollar helped gold hit its highest level in nearly two weeks on Monday, but investors were expected to trade cautiously ahead of the U.S. Independence Day holiday.
Investors sold European stocks and bought government bonds and gold as trading got underway for the second half of 2007 on Monday, driven by security concerns after weekend bomb plots in Britain and higher oil prices.
The yen faced fresh losses on Friday, while bonds were flat as investors put this week's wave of risk aversion behind them, comforted by a relatively neutral statement from the Federal Reserve.
Stock futures eased on Friday suggesting a fall on Wall Street after the Federal Reserve kept interest rates unchanged on Thursday but flagged persistent price pressures, reducing the chances of a rate cut.
The dollar strengthened against the low-yielding yen on Friday after the Federal Reserve reiterated its concern over persistent price pressures, suggesting little chance of an interest rate cut soon.
The U.S. economy grew slightly faster than previously estimated in the first quarter, but still at the weakest pace in more than four years and inflation was higher as well, data on Thursday showed.
General Mills Inc. on Thursday said quarterly profit edged higher, though increased marketing spending and higher commodity costs tempered the increase.
Gold steadied on Thursday after hitting three-month lows the previous day, but analysts were waiting for the outcome of a two-day Federal Reserve meeting that should steer financial markets in the short term.
