- Canada statutory holiday-government offices and banks closed
- JOLTS job openings expected to drift lower.
- US dollar opens defensively.
USDCAD open 1.3916, overnight range 1.3907-1.3925, close, 1.3917, WTI 62.70, Gold 3799.25
The Canadian dollar attempted to rally but lacked follow-through despite broad US dollar weakness The Loonie remains on the defensive after last week’s remarks from Bank of Canada Governor Tiff Macklem warned that trade frictions would dampen domestic growth prospects.
WTI slipped to 62.46 from 63.45 as concerns over additional Opec supply weighed on sentiment. Reports suggest the cartel may announce a further 137,000 bpd increase for November at its October 5 meeting.
Traders are looking to today’s JOLTS Job Openings report, projected at 7.1 million compared to 7.181 million in July, for another gauge on whether the US labor market is easing. A print in line with expectations would signal a cooling trend but also confirm resilience. The Chicago PMI and Consumer Confidence surveys are also due later.
Trump imposed new tariffs ranging from 10% to 50% on softwood lumber, kitchen cabinets, vanities, and upholstered wood imports, effective October 14. Meanwhile, the clock is ticking toward a US government shutdown at 12:01 am October 1, with Democrats unwilling to extend funding unless Trump agrees to reduce healthcare costs.
Asian equity markets were mixed overnight. Japan’s Topix added 0.19%, Australia’s ASX 200 slipped 0.16%, and Hong Kong’s Hang Seng gained 0.87%.
As of 7:30 am EDT, European bourses showed no clear direction, with the German DAX and UK FTSE 100 edging up just 0.06% while the French CAC-40 was down 0.36%. S&P 500 futures slipped 0.19%, the US dollar index eased to 97.78 from 97.98, and the US 10-year Treasury yield sat at 4.139%.
EURUSD traded in a 1.1712-1.1761 band before easing to 1.1746 at the New York open, with price action largely reflecting a softer dollar tone. This week’s US employment data is steering FX sentiment, while weaker-than-expected German retail sales (-0.2% m/m vs forecast +0.6%) and a 14,000 rise in unemployment to 2.98 million highlight ongoing domestic challenges. Traders are also looking for any hints on policy direction from ECB President Christine Lagarde later today.
GBPUSD bounced between 1.3421 and 1.3452, underpinned by stronger Q2 GDP growth at 1.4% y/y, beating the 1.2% consensus. Adding to the support, the UK’s diplomatic outreach with Trump seems to have borne fruit, with Britain notably excluded from the latest tariff salvo.
USDJPY slipped in a 147.83-148.84 range as government shutdown jitters encouraged safe-haven yen buying. The BoJ’s summary of opinions revealed a more hawkish tone, with some policymakers favoring rate hikes in the near future. Retail sales data, however, came in weaker than anticipated, tempering the outlook.
AUDUSD climbed from 0.6571 to 0.6614, supported by improved sentiment toward China and a broadly softer dollar. The RBA left its policy rate unchanged at 3.6%, as expected, keeping the focus on external drivers rather than domestic policy.
Canada observes Truth and Reconciliation Day today, with federally regulated sectors such as government and banking closed. In practice, it is not a universal holiday—workers in British Columbia and Manitoba benefit from the day off, while those in Ontario and Quebec do not.
