Today's expected range for the Canadian Dollar against the major currencies:
US Dollar 1.3760-1.4010
Euro 1.6040-1.6290
Sterling 1.8540-1.8790
WTI Oil (opening level) $61.65
The CAD/USD is opening at 1.3879 ( 0.7205 )
USD/CAD trades steadily, holding above the rising 20-day Exponential Moving Average at 1.3819, keeping the short-term bias positive.
The 14-day Relative Strength Index at 59.87 signals improving bullish momentum without overbought conditions.
Measured from the 1.4143 high to the 1.3641 low, the 50% Fibonacci retracement at 1.3892 acts as initial resistance, and a close above it could open a test higher toward 61.8% Fibo retracement at 1.3931. Failure to clear this barrier would keep consolidation intact, while a break above would underpin an extension.
Headlines
· Trump dismissed Jamie Dimon’s criticism over the DOJ probe into the Federal Reserve, saying he JPM CEO was “wrong” to suggest he was undermining the independence of the central bank. Trump said he would press ahead with plans to announce Fed Chair Jerome Powell's replacement despite backlash to the probe, which has drawn criticism from Republican lawmakers.
· U.S. annual inflation held at 2.7% in December, consistent with November and expectations. Energy prices eased, gasoline fell, and natural gas rose. Used car price growth slowed; food and shelter costs increased. Core inflation stayed at 2.6%, its lowest since 2021, below the expected 2.7%. Monthly CPI rose 0.3% due to shelter costs, with core CPI at 0.2%, under the forecasted 0.3%.
· Trump reaffirmed a proposal for a 10% cap on credit card rates for one year. He announced upcoming housing affordability plans, with details to be unveiled at Davos. He praised the impact of the $200 billion mortgage bond purchase and stated that lowering mortgage rates would be easier with Fed support, adding that Powell will be out soon.
· The U.S. recorded a $144.7 billion budget deficit in December, up from $86.7 billion a year earlier. Receipts grew 6.6% to $484.4 billion, spurred by income taxes and social insurance. Outlays rose 16.3% to $629.1 billion, mainly for Social Security, Health and Medicare, and defense, affected by payment timing.
· The U.S. Economic Optimism Index fell to 47.2 in January from 47.9, below the forecast of 48.2. The Six-Month Outlook decreased 2.5% to 43.3, and Confidence in Federal Policies dropped 4.2% to 43.5. Meanwhile, the Personal Financial Outlook increased 1.7% to 54.9.
· Greenland's prime minister ruled out joining the US and said the Arctic territory prefers to be in a union with Denmark. The PM’s remarks come ahead of a high-stakes meeting of Danish and Greenlandic foreign ministers with US Secretary of State Marco Rubio and US Vice President JD Vance in Washington today.
Key Points
· Equities: US slips on rate-cap worries, Europe holds near records, Asia rallies as Japan hits fresh highs and Hong Kong advances.
· Volatility: Low but rising, US PPI and retail sales, bank earnings, political risk premium
· Digital assets: Bitcoin above USD 95k, Strategy buying, ETF inflows supportive
· Currencies: USD stays firm after soft core CPI. Fresh JPY weakness as USDJPY eyes 160.00 level.
· Commodities: Silver surges above USD 90; gold and copper hitting fresh highs; oil steadies after rally with focus on Iran.
· Fixed Income: US treasury yields ease lower after soft US December CPI print