Today's expected range for the Canadian Dollar against the major currencies:
US Dollar 1.3910-1.4160
Euro 1.6050-1.6300
Sterling 1.8320-1.8570
WTI Oil (opening level) $60.90
The CAD/USD is opening at 1.4041 ( 0.7122 )
Headlines
· The White House announced Saturday that China will lift export controls on rare earths and end probes into U.S. semiconductor firms under a new trade pact. China will issue general export licenses for key materials, reversing previous curbs. In exchange, the U.S. will pause certain tariffs and cancel a planned levy on Chinese goods. China will halt restrictions on rare-earth magnets, while the U.S. eases some curbs on Chinese firms. Additionally, China pledged to buy 12 million metric tons of soybeans this season and 25 million tons annually for three years. The pact aims to reduce trade tensions affecting global markets. Trump told Xi that chip sales are "between you and Nvidia".
· Friday, the Chicago PMI Business Barometer rose to 43.8 from 40.6, exceeding expectations. While below 50 for the 23rd month, it signaled the mildest contraction in three months, driven by a rebound in new orders and improvements in output and backlogs. Employment growth hit its lowest since February.
· September 2025, Canadian GDP grew by 0.1%, indicating a similar increase in Q3 according to a flash estimate. This uptick follows a revised 0.3% contraction in August, the steepest monthly drop since December 2022, driven by Canada-U.S. trade war impacts and high BoC interest rates. Goods industries fell 0.6%, notably utilities by 2.3% and mining by 0.7%, due to lower global prices. Services dipped 0.1%, as transport and warehousing fell 1.7% and wholesale trade contracted 1.2%, despite retail trade's 0.9% gain. Year-on-year, GDP grew 0.7% in August.
· Euro area consumer inflation fell to 2.1% in the flash estimate of October 2025 CPI, nearing the ECB's 2% target and meeting expectations. Food, alcohol, and tobacco prices rose 2.5% compared to 3.0% in September. Non-energy goods inflation dropped to 0.6%, and energy costs decreased by -1.0%. Meanwhile, services inflation increased to 3.4%, the highest since April, while core inflation, excluding energy and food, held at 2.4%
Key Points
· Equities: US inched higher on AWS-led tech strength, Europe slipped on mixed earnings, Asia split as Japan hit records while China/HK fell
· Volatility: steady vigilance, SPX ±1.4% move, skew slight call-lean, macro data focus
· Digital Assets: BTC/ETH holding pattern, IBIT & ETHA small inflows, alts follow macro/liquidity
· Currencies: US dollar and sterling firmed against a weaker euro.
· Commodities: Gold holds above USD 4000, crude supported by OPEC+ constraint
· Fixed Income: US Treasury yields eased slightly lower after FOMC-inspired runup earlier in the week.