Markets await the BoC rate decision on Wednesday
Daily Currency Update
Markets are anxiously awaiting the Bank of Canada (BoC) rate decision on Wednesday. The BoC is expected to keep interest rates unchanged due to easing labour demand and price pressures. In oil news, West Texas Intermediate (WTI) crude oil fell 87 as tensions ease in the Middle East.Key Movers
The 10-year U.S. Treasury yield moved above 5% today to its highest level since 2007, pushing demand for the US dollar down. The US dollar index (DXY) was down slightly this morning -0.2% to the 105.945 level. This came as markets expect central banks to keep rates high, particularly in the United States. There are no notable data releases set for the US today but markets will be awaiting the flash manufacturing Purchasing Manager’s Index (PMI) as well as the flash services PMI data report tomorrow.In Eurozone news, the EUR consumer confidence data was released at the same level as forecasts and previous readings at -18. Both the Eurozone and the UK markets will be awaiting the release of the French, German, and UK flash manufacturing PMI as well as the flash services PMI data which is set for tomorrow.
The JPY has been eyeing new lows against the USD with the USD/JPY pair passing 150 today. If the pair trades well above the 150 level, volatility could accelerate for both currencies. Markets continue to speculate if intervention by the Bank of Japan (BoJ) will come soon.
Australian flash manufacturing PMI as well as the flash services PMI data is scheduled to be released tonight. Australian markets will also be keeping an eye on the Consumer Price Index (CPI) data which will be released tomorrow.
Expected Ranges
- EUR/CAD: 1.4498 - 1.4566 ▲
- GBP/CAD: 1.6652 - 1.6726 ▲
- AUD/CAD: 0.8631 - 0.8669 ▲
- USD/CAD: 1.3690 - 1.3737 ▼