CAD down versus USD, EUR, AUD, and GBP so far today

Key Movers

he ECB is expected to cut rates twice more this year, with a total reduction of 50 basis points. While inflation is anticipated to return to the council’s 2% target, ECB officials have been cautious about committing in advance and have suggested that any future rate cuts would depend on economic data. Finnish policymaker Olli Rehn indicated that the path back to 2% could be bumpy and added that, if the expected rate cuts materialize, they should help support Europe’s struggling manufacturing sector.

In the UK, investors will be closely monitoring the release of employment data on Tuesday and consumer price inflation on Wednesday. Employment is expected to rise to 4.5% from the previous 4.4%, while markets anticipate a significant drop in wage pressures, with forecasts of a decrease to 4.6% from the previous month’s 5.7%. If prices don’t fall as much as expected, the Pound could strengthen this week.

In the US, markets now see a 50/50 chance of the Federal Reserve cutting rates by 50 basis points at their upcoming September meeting. Fed Governor Michelle Bowman stated that “should the incoming data continue to show price pressure easing back to 2%, it will be appropriate to gradually lower borrowing costs in the US to avoid restricting employment and economic activity.”