Forex Today: Tensions mount ahead of first-tier events

What you need to take care of on Tuesday, October 26:

The American Dollar started the week losing ground, extending its Friday's decline at the opening, but slowly grinding higher as the day developed. It ended with modest gains against most major rivals as investors await first-tier events scheduled for later in the week.

European and American indexes managed to close Monday with gains, despite growth-related figures were generally discouraging, as most S&P Global PMIs missed expectations. The October flash PMIs indicated a steeper contraction in the Union and the United States at the beginning of Q4. The EUR/USD pair ended the day little changed, around 0.9870.

Rishi Sunak became the new United Kingdom Prime Minister after Liz Truss's failed 44-day government. GBP/USD ended the day in the red, around 1.1280.

Chinese data published at the beginning of the day was mostly upbeat. The Q3 Gross Domestic Product beat expectations, up by 3.9% QoQ. The September Trade Balance posted a surplus of $84.74 billion, better than anticipated, while Industrial Production rose by 6.3% YoY. Finally, Retail Sales increased by 2.5% YoY, up, although below the market's forecast of 3.3%. Also, the country announced it would raise fuel prices on Tuesday, weighing on local equities.

USD/JPY remained volatile, ending the day roughly 450 pips up after bottoming at 145.37. Japan's Prime Minister Fumio Kishida anticipated an upcoming stimulus package to be announced by the end of October as planned. Meanwhile, the Bank of Japan suspected intervention last week was estimated at 5.5 trillion yen.

 Tensions between Germany and Russia continue. The German Chancellor Olaf Scholz said they want Ukraine to become an EU member state. On the other hand, Moscow has asked UN Secretariat for data on Ukrainian grain and its destinations and end consumers, and Russian Foreign Minister Lavrov hinted at "corrections" to the  Black Sea grain deal.

Gold trades at around $1,650 a troy ounce, marginally lower on a daily basis, while crude oil prices were little changed. WTI settled at $84.70 a barrel.

In the upcoming days, several central banks will announce their monetary policy decisions. The Bank of Canada, the Bank of England and the European Central Bank will make their announcements these days, while the Reserve Bank of Australia and the US Federal Reserve will unveil their decisions next week. In the middle, the US will publish the preliminary estimate of its Q3 Gross Domestic Product, foreseen reverting the negative trend of the first two quarters of the year.