Today's expected range for the Canadian Dollar against the major currencies:
US Dollar 1.3780-1.4030
Euro 1.6040-1.6290
Sterling 1.8520-1.8770
WTI Oil (opening level) $59.93
The CAD/USD is opening at 1.3900 ( 0.7194 )
Commodities from crude oil to key metals, from gold and silver to platinum and copper, all slid after Trump signalled he may hold off on attacking Iran for now, and after the U.S. held off imposing tariffs on imports of critical minerals, easing a key concern that in recent months had driven unusually large flows of metal into the US ahead of a potential announcement.
Silver saw a sharp reversal after hitting a fresh record high at USD 93.75 but has since found a bid near Tuesday’s lows around USD 86.50, potentially signalling that the momentum- and tight supply-led rally continues to attract speculators, not least in China, where local prices trade at a notably premium over those in London and New York.
Oil prices fell for the first time in six days on easing concerns over a major Middle East supply disruption after Trump said he had been assured that Iran would stop killing protesters. While the situation remains fragile, the immediate risk premium has softened. Elsewhere, the EIA reported the biggest US crude stock build since November lifted by imports hitting a 14-month high, adding relative downward pressure on WTI versus Brent.
Headlines
· U.S. producer prices rose 0.2% in November, matching forecasts. Goods prices jumped 0.9% due to higher energy costs. Excluding food and energy, prices rose 0.2%. Core PPI was unchanged, below a predicted 0.2% rise. Annually, producer inflation hit 3.0%, above the forecasted 2.7%, with core inflation also at 3.0%.
· Trump stated that Greenland is vital for U.S. national security and NATO, citing the "Golden Dome." Denmark and Greenland's foreign ministers met with JD Vance, while Germany plans to send soldiers to Greenland, as confirmed by multiple sources.
· Trump imposed a 25% tariff on certain AI chips, including Nvidia’s H200 and AMD’s MI325X, for national security reasons. The action aims to boost U.S. semiconductor production and reduce reliance on foreign suppliers, addressing economic and security risks.
· U.S. retail sales increased by 0.6% in November, the highest since July, exceeding the 0.4% forecast and rebounding from October's 0.1% decline. The growth was driven by auto sales recovery and holiday shopping, with notable gains in sporting goods, miscellaneous stores, gasoline, building supplies, and autos. Sales for GDP calculation, excluding specific categories, rose 0.4%.
· U.S. existing home sales rose 5.1% in December to 4.35 million, the highest in nearly three years, exceeding expectations. Inventory dropped 18.1% to 1,180,000, equal to 3.3 months' supply. The median price rose 0.4% to $405,400. NAR's Lawrence Yun noted improvements in the fourth quarter, with better mortgage rates and slower price growth across all regions.
Key Points
· Equities: U.S. shares slipped on bank earnings and tech, Europe closed at a record, Hong Kong rose again on health tech
· Volatility: near-term risks dominate volatility pricing, downside insurance still in demand despite moderate VIX levels
· Digital assets: bitcoin stabilises, ETF flows keep crypto linked to equity market sentiment
· Fixed Income: US treasuries find support on weak risk sentiment.
· Currencies: JPY edges weaker after intervention-inspired strength Wednesday. USD firms.
· Commodities: Oil and metals slip as Iran attack risk and tariff worries fade