- NFP expected to be weak
- Oil firms on geopolitical tensions
- US dollar opened soft but squeezed out gains in early NY trading
USDCAD open: 1.3510, overnight range 1.3504-1.3568, close 1.3554, WTI 64.89, Gold 5094.19
The Canadian dollar has embraced the sell the US dollar narrative and prices continued to slide despite renewed threats from Trump.
WTI traded in a 64.19-65.20 range and is sitting near the session high in New York. Prices are being supported by developments surrounding US-Iran nuclear negotiations. President Trump has stepped up pressure on Tehran by signaling the potential deployment of another carrier strike group to the region. That headline overshadowed the American Petroleum Institute report showing a sizable 13.4 million barrel build in US crude inventories last week.
Its NFP day today. The greenback has already responded to softening expectations for the data, as forecasts for a 55,000-75,000 increase have pressured the currency since Monday. That followed comments from White House economic adviser Kevin Hassett, who said markets should be prepared for “slightly smaller job numbers.” Some analysts also caution that changes in the calculation methodology could distort the headline result, potentially biasing it lower. The US Dollar Index slipped to 96.49 overnight from 96.67 as traders positioned defensively ahead of the release.
President Trump repeated his argument that the United States should maintain the lowest interest rates globally and suggested that a 2-basis-point reduction would eliminate the fiscal deficit. That view contrasts with remarks from Cleveland Fed President Beth Hammack and Dallas Fed President Lorie Logan, who signaled little urgency to ease policy. Hammack indicated rates could remain unchanged for an extended period, while Logan said she is not yet convinced inflation is firmly on track toward 2.0%.
Asian equity markets advanced, led by a 1.90% gain in Japan’s Topix. Australia’s ASX 200 rose 1.66%, and Hong Kong’s Hang Seng added 0.31%.
As of 8:00 am, European markets are mixed. The UK FTSE 100 is higher by 0.69%, while France’s CAC 40 is done 0.24% and Germany’s DAX has lost 0.12%. S&P 500 futures are flat. The US Dollar Index is 96.72, and the 10-year Treasury yield stands at 4.133%.
EURUSD traded in a 1.1886-1.1928 range, supported by broad US dollar softness ahead of the payrolls report. Ongoing discussion about potential erosion of Fed independence continues to underpin the single currency.
GBPUSD moved within a 1.3632-1.3701 band and is trading near 1.3712 in New York. Sterling recovered after Prime Minister Starmer appeared to deflect political pressure tied to recent allegations, though prediction markets still assign elevated odds to his resignation by June 30.
USDJPY slid from 154.52 to 152.80 before stabilizing around 153.39. Growing anticipation that the Bank of Japan will continue tightening has outweighed concerns about fiscal expansion, keeping pressure on the pair.
AUDUSD advanced from 0.7067 to 0.7129, buoyed by generalized US dollar weakness and hawkish remarks from Deputy Governor Andrew Hauser, who stressed that inflation remains uncomfortably high due to demand exceeding supply. Markets interpreted the comments as leaving the door open to additional rate increases.
