The USD has remained largely confined to ranges over the past several weeks. In EUR/USD, that range has been roughly 1.53-56; in USD/JPY, 102.50-105.50; in GBP/USD, 1.94-97; and in USD/CAD 0.9950-1.0250. To a large extent, these range-bound trading conditions reflect the current inertia of monetary policy at key central banks, with most interest rate policy setters now seen to be on hold. Given the offsetting effects of slowing growth in major economies and high inflation rates, the stalemate looks set to continue in the weeks ahead. Other markets, such as US stocks and Treasuries, are similarly range-bound owing to ongoing uncertainty and the lack of a clear directional theme to trade on. Even oil, which has caught a great deal of attention in recent weeks, looks to have reached a plateau, closing last week just below $126/bbl, and looks set to finish out this week only slightly higher at $126.60/bbl.  Full text »

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