Today's expected range for the Canadian Dollar against the major currencies:
US Dollar 1.3670 - 1.3920
Euro 1.5900 - 1.6150
Sterling 1.8570 - 1.8820
WTI Oil (opening level) $93.23
The CAD/USD is opening at 1.3794 ( 0.7249 )
CAD has outperformed the USD due to surging oil prices.
WTI Oil price is up 1%, higher than anytime in the last month.
On the daily chart, USD/CAD trades at 1.3783, keeping a bearish near-term tone as it holds beneath the 20-day Exponential Moving Average (EMA) at 1.3865 and the 61.8% Fibonacci retracement at 1.3817, which is plotted from the May low of 1.3550 to the June high at 1.4248.
On the topside, immediate resistance is seen at the 20-day EMA around 1.3865, followed by the 50.0% Fibonacci retracement at 1.3901 and then the 38.2% retracement near 1.3983, with the 23.6% level at 1.4085 acting as a more distant cap if a stronger rebound unfolds. On the downside, initial support emerges at the 78.6% Fibonacci retracement around 1.3701, with a deeper floor located at the 100.0% retracement near 1.3551, where bears would likely reassess the strength of the broader decline.
Headlines
· US August payrolls beat: Friday's jobs report rose 162k in August, well above the estimated 55k, with the unemployment rate holding steady at 4.1%. Both June and July figures were also revised upwards by a combined 55k. The data boosted Fed rate-hike bets, with money markets pricing over a 50% probability of a September hike. The 2-year Treasury yield briefly rose to a new cycle high in reaction to the data, trading above 4.41% at one point, but receded to close below 4.37% and therefore within the range from earlier in the week.
· The ECB is expected to hike Thursday: The ECB is widely expected to deliver a second consecutive 25bp rate hike at its Thursday meeting, cementing its status as the most hawkish G7 central bank. Debate is already shifting to whether a third hike will follow later in the year.
· Iran said a shipping-management deal with Oman for the Strait of Hormuz was near, heightening concern over its control of the chokepoint. Oil surged nearly 10% last week as renewed US-Iran clashes, including US strikes on Iranian tankers and attacks on ships and military targets around Hormuz, stoked supply fears. Saudi Aramco’s Jazan facilities were also hit again with limited damage, though about 7 million barrels a day still transit the strait.
· Japan’s GDP grew 0.4% q/q in Q2 2026, above the 0.3% flash estimate and matching expectations. It was the third straight quarter of growth, driven by stronger government spending and a smaller-than-expected decline in business investment. Meanwhile, Japan’s average cash earnings rose 4.7% y/y in August 2026, beating forecasts (3.9%) and marking the fastest gain since January 1997.
· UK like-for-like retail sales rose 0.5% y/y in August, down from 1% in July and the weakest since October 2024. Total sales growth slowed to 0.7%. Food sales rose 2.6%, non-food fell 0.8% as earlier heatwaves pulled forward spending and big-ticket items weakened. Barclays reported consumer spending up 2.1% y/y, while confidence slipped to 26% from 30%.
· US producer prices are due Thursday and August consumer prices (CPI) on Friday, ahead of the 15 to 16 September Federal Reserve meeting.
Key Points
· Macro: Hormuz tensions fuel inflation concerns ahead of US price data.
· Equities: US markets were closed, Europe stayed flat as oil revived inflation worries, Asia was mixed as chips rallied but yen strength weighed.
· Volatility: Equity fear stayed contained while the cost of protecting against an oil shock remained exceptional.
· Digital Assets: Bitcoin drifted lower over the long weekend as Coinbase pushed further into regulated derivatives.
· Commodities: Copper hits record on tight supply and US tariff expectations; Brent holds near USD 100 as wheat rebounds
· Fixed Income: European yields pull back to cycle highs on energy prices. Long-dated JGB’s rally anew.
· Currencies: Sharp yen strengthening continues, entering fifth day. AUDNZD new 13-year high.