STERLING RESURGENT

The seismic shift in rates saw sterling hit its highest since the Brexit vote and notch its best week in almost nine years against a currency basket.

On Monday, the pound was a shade softer at $1.3585 GBP= but not far from the peak of $1.3615. The euro was steady at $1.1945 EUR=, sandwiched between support at $1.1836 and resistance at $1.2092. 

The dollar held firm on the yen at 111.21 JPY=, with the Bank of Japan widely expected to maintain its massive asset buying campaign at a meeting on Thursday. 

Political uncertainty also made a surprise appearance after sources said Japanese Prime Minister Shinzo Abe was considering calling a snap election for as early as next month to take advantage of his improved approval ratings and disarray in the main opposition party. 

Against a basket of currencies, the dollar was idling at 91.851 .DXY and still uncomfortably close to the recent 2-1/2 year trough of 91.011. 

The modest bounce in the dollar combined with all the talk of monetary tightening put gold on the defensive. The precious metal was little changed at $1,318.96 an ounce XAU=. 

Oil prices were hovering near five-month highs helped by forecasts for rising demand and the gradual restart of U.S. oil refineries. 

Brent crude LCOc1 was up 2 cents on Monday at $55.64 a barrel, following gains of 3.3 percent last week. U.S. crude CLc1 eased 1 cent to $49.88 a barrel.