- Risk sentiment sours on US jobs data
- Japan announces major fiscal stimulus package
- US dollar opens with gains
USDCAD open: 1.4093, overnight range 1.4082-1.4106 close, 1.4098, WTI 57.48, Gold 4037.85
The Canadian dollar dropped yesterday and continued to do so overnight and in early NY trading today. Broad-based US dollar demand, and downbeat economic comments from BoC policymakers on Wednesday are weighing on the currency. Today’s Canadian Retail Sales data won’t do anything to improve the mood if the forecast of a drop of 0.7% in September is accurate.
WTI oil prices are under pressure from hopes that Trump’s Ukraine/Russia peace plan bears fruit , although the EU is not in favour. WTI is in the middle of its 57.44-58.74 range.
Yesterday, US employment data reduced the chance of a December rate cut and reopened concerns about stretched AI valuations. That combination pushed equities toward a weekly loss, while the US dollar found renewed support.
Asian equity markets closed deep in the red. Hong Kong’s Hang Seng plunged 2.38%, Japan’s TOPIX dropped 1.84%, and Australia’s ASX 200 lost 1.59%.
As of 7:30 am, the German DAX is down 0.86%, the French CAC-40 has lost 0.34%, and the FTSE 100 index is down 0.38%. S&P 500 futures are down 0.36%, the US Dollar Index (DXY) is 100.33, the US 10-year Treasury yield has eased to 4.05%, and gold (XAUUSD) is $4049.11.
EURUSD traded in a 1.1513–1.1553 band, with the high reached during the European session and the low in early New York dealing. The move reflected shifting expectations for US monetary policy after traders pared back hopes for a December Fed cut. JPMorgan moved its rate outlook to unchanged rather than a 25 bp reduction. ING analysts suggested Eurozone PMI data hinted at gradual improvement, although Hamburg Commercial Bank’s Chief Economist Cyrus de la Rubia described the region’s manufacturing sector as stuck in a period of directionless stagnation despite small production gains since March.
GBPUSD moved within a 1.3051–1.3103 range and is sitting near the lower end after UK PMI results fell short. S&P Global’s Chief Economist Chris Williamson noted that November’s initial PMI figures implied stalled growth, rising job losses, and fading business confidence, with the surveys aligning to flat GDP for the month and only minimal expansion so far this quarter. Markets are now looking ahead to next week’s Autumn Budget.
USDJPY fluctuated between 157.55 and 156.55 as traders reacted to domestic and political headlines. The government under Prime Minister Sanae Takaichi unveiled a 21.3 trillion yen stimulus proposal, though it still requires broader support to move forward. The announcement overshadowed the release of inflation and PMI data. At the same time, Finance Minister Satsuki Katayama hinted that authorities could step in if currency moves become disorderly, stressing the need for exchange rates to align with underlying fundamentals.
AUDUSD traded in a 0.6423–0.6458 range, easing overall as the stronger US dollar weighed following reduced expectations for a December Fed cut. The downside was cushioned somewhat by better-than-forecast October Manufacturing PMI results, which rose to 51.6 from 49.7.
Todays US data includes Michigan Consumer Sentiment and S&P Global Manufacturing and Services PMI reports.
