Fed Governor Christopher Waller is set to speak, and he is expected to underscore that a rate hike remains likely ahead of the September 16 FOMC meeting unless incoming data turn unexpectedly dovish. Markets have shifted to a new baseline that the Fed will raise rates in September, keeping the dollar steady after earlier gains. USD/JPY is expected to stay elevated around 160-162 on the hawkish outlook, while the Bank of Canada is seen holding rates at 2.25% as core inflation remains well anchored.

Turkey’s annual inflation extended its decline to 31.8% in July, staying well above the central bank’s 24% target and the 26% forecast in its latest inflation report. Core inflation rose to 29.9% year on year, indicating underlying price pressures have not eased. The average USD/TRY increase was 1.7% month on month in July and around 17% on an annual basis, far below inflation, reflecting the central bank’s continued exchange-rate policy to support disinflation through costs.

Germany’s Ifo business climate index rose to 86.6 in July, extending its climb to a third consecutive month, with the expectations sub-index jumping 2.6 points to 86.7. The current assessment component edged lower, and the headline level remains below its five-year average. The reading is described as reflecting a short-lived lift from the earlier US-Iran memorandum of understanding, while a renewed surge in energy prices, rising Middle East conflict risks and record-low Rhine water levels are weighing on industrial supply chains and the growth outlook.