Today's expected range for the Canadian Dollar against the major currencies:
US Dollar 1.3760 - 1.4010
Euro 1.5960 - 1.6210
Sterling 1.8670 - 1.8920
WTI Oil (opening level) $87.84
The CAD/USD is opening at 1.3874 ( 0.7207 )
Gold and silver remain challenged by another rise in global bond yields to their highest in almost two decades, as rising oil and food prices stoke inflation concerns that could force central banks to raise rates, increasing the funding cost of holding non-interest-bearing assets. These headwinds are being partly offset by investors seeking protection in hard assets amid concerns over elevated and rising government debt levels, and the increased cost of servicing this debt. Gold has so far retraced only 38.2% of its August rally, which in technical terms is considered a relatively shallow correction within an established uptrend. For that picture to change, prices would need to break below a band of support in the USD 4,200–4,240 area. Conversely, a move back above the 200-day moving average could attract renewed demand on the view that the latest correction has run its course.
Headlines
· US and Iran resumed hostilities. US forces struck Iranian launchers and President Trump threatened Kharg Island, while Iran retaliated against the UAE and Jordan. Crude still transits the Strait of Hormuz despite a supertanker fire caused by naval mines, and Russian strikes on refineries appear to be tightening global refining capacity and lifting fuel margins.
· Washington leaned on the Bank of Japan. US Treasury Secretary Bessent reportedly told Governor Ueda and Finance Minister Katayama at the G20 in North Carolina that Japan's next move should be a rate hike, adding that he expects a stronger yen once the central bank and the government act.
· European inflation firmed while US survey data improved. German inflation rose to 2.9% in August, a four-month high just under the 3.0% consensus, with energy inflation at 10.5% and core steady at 2.4%. UK shop price inflation climbed to 1.5% from 0.9%, the highest since February 2024. The Dallas Fed Texas manufacturing index jumped to 11.6 from 1.3, its best since January 2025.
· The week's calendar starts today. US ISM manufacturing is expected at 55.2 against 55.6 previously, alongside JOLTS job openings and construction spending. August payrolls land on Friday 4 September, into a market now pricing a September Fed hike.
Key Points
· Macro: Stocks fall as higher oil prices and rising global bond yields weigh on markets
· Equities: US and European stocks fell as oil and yields rose, Asian markets weakened, with Shein sliding on its Hong Kong debut.
· Digital Assets: Crypto equities snapped back hard while the coins themselves barely moved overnight
· Commodities: Crude rises on supply risks; gold steadies after two-session retreat; agriculture hits fresh multi-year high
· Fixed Income: US 10-year yield clears 4.75% for first time in 19 months. The 10-year German Bund yield hits 15-year high. Japan’s 10-year JGB yield hit a 30-year high.
· Currencies: USD volatility muted, JPY and CHF weak on rising global bond yields.