Today's expected range for the Canadian Dollar against the major currencies:
US Dollar 1.3560-1.3810
Euro 1.6190-1.6440
Sterling 1.8670-1.8920
WTI Oil (opening level) $60.65
The CAD/USD is opening at 1.3693 ( 0.7303 )
CAD is navigating a complex mix of trade uncertainty and macro signals.
Renewed US tariff threats tied to Canada’s relationship with China have injected headline risk into FX markets, even as Canadian officials have attempted to calm fears of a near-term escalation. While investors appear skeptical that extreme trade measures will be implemented quickly, the rhetoric alone has been enough to keep the Loonie sensitive to political developments and broader risk sentiment.
Attention is also firmly on monetary policy. The Bank of Canada is expected to keep rates unchanged, but markets will closely parse its statement and tone for clues on how policymakers are weighing external trade risks against domestic growth and inflation trends. South of the border, a dense US economic calendar including growth, inflation, and labor-related data has the potential to shift expectations around the Federal Reserve’s policy path, with direct implications for the USD side of the USD/CAD pair.
Headlines
· Trump announced tariffs on South Korean goods would rise from 15% to 25%, affecting products like cars and pharmaceuticals if its legislature failed to sign the trade deal agreed back in July. The timing of the new tariffs is unclear.
· US durable goods orders jumped 5.3% in November 2025, rebounding from a 2.1% October drop, driven by a 97.6% surge in civilian aircraft orders. Other increases included electrical equipment, metals, machinery, and electronics. Excluding transportation, orders rose 0.5%; excluding defense, they surged 6.6%. Non-defense capital goods orders, excluding aircraft, increased 0.7%.
· The Chicago Fed National Activity Index rose to -0.04 in November 2025 from -0.42 in October, showing improving economic growth (the number is relative to trend growth). Production contributed +0.08, up from -0.26; employment improved to -0.07 from -0.11; sales and inventories held at -0.03; and consumption and housing ticked up to -0.02. The CFNAI Diffusion Index rose to -0.24 from -0.43.
· Focus is on Wednesday’s Fed decision amid speculation of the announcement of Trump’s choice for Fed Chair and a possible partial government shutdown from Democratic opposition to Homeland Security spending. Trade uncertainty remains with Trump’s tariff threat on Canadian imports linked to a China deal, though Ottawa downplays it.
Key Points
· Equities: U.S. stocks rose ahead of the Federal Reserve, Europe edged up, Asia mixed as Japan fell and Hong Kong held.
· Volatility: Vix stable, short-dated stress fades, skew elevated, Fed decision in focus
· Digital assets: Bitcoin rangebound; altcoins steady; IBIT resilient; ETHA softer; macro-driven sentiment
· Currencies: JPY comeback has stalled after steep rally. US sideways after sharp weakening Monday.
· Commodities: Gold holds above USD 5,000; silver’s wide range highlights growing unease and potential rally fatigue; nat gas retreats after doubling
· Fixed Income: Japan’s yields rise again, US benchmark 10-year treasury yield quiet after retreating to important level