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USD/CAD holds flat near 1.40 as traders eye potential catalysts from a US-Canada trade deal and next month’s pro-growth Canadian budget, BBH FX analysts report.

• Full speach here

Dhingra is an uber dove. She’s been advocating for rate cuts, even aggressive ones, for years. Large tariffs might indeed be negative for growth and prices. But if you run expansionary policies into those increases, especially when you’ve been above target for years, then from a risk management perspective you can’t really cut rates on a forward looking basis.

You risk making those increases permanent. In my opinion, being less forward looking and waiting for more clarity makes much more sense.

This article was written by Giuseppe Dellamotta at investinglive.com.

Gold (XAU/USD) edges higher on Thursday, trading around $4,115, up nearly 0.40% for the day. Demand for safe-haven assets remains firm amid the prolonged budget deadlock in Washington and persistent geopolitical uncertainty.

On Tesla’s earnings call, Elon Musk said that if the company has too many of its AI5 chips, it can use them in the data center.

The new sanctions are related to plans for a meeting between President Donald Trump and Russian leader Vladimir Putin being dropped.

• Prior -27

This article was written by Justin Low at investinglive.com.

Fundamental
Overview

The USD has strengthened
since Friday as Treasury yields bounced following some positive Trump’s
comments on China. Overall, the US dollar performance has been mixed as markets
have been driven by quick changes in risk sentiment given the lack of US data.

On the domestic side, the
US government shutdown continues to delay many key US economic reports.
Tomorrow though, we will get the US CPI data since it’s crucial for social security
benefits adjustment required by November.

The dollar “repricing
trade” needs strong US data to keep going, especially on the labour market
side, so any hiccup on that front should keep weighing on the greenback.

Since Trump’s threat of
massive tariffs on China, the market pricing turned more dovish with 126 bps of
easing seen by the end of 2026 (the Fed projected just 75 bps). Therefore, if we
de-escalate further and the US data picks up, there’s plenty of room for the
greenback to appreciate.

On the EUR side, the single
currency found some support last week as the French political risk eased after
Lecornu survived the no-confidence vote. On the monetary policy side, nothing
has changed. The ECB is not expected to adjust rates for a long time unless we
get significant deviation from their inflation target.

In fact, the vast majority
of ECB members is comfortable with the current rate setting and will not
respond to small or short-term deviations from their target barring a clear
shock in the economy.

EURUSD Technical
Analysis – Daily Timeframe

On the daily chart, we can
see that EURUSD rolled back to the key support zone around the 1.1573 level.
This is where we can expect the buyers to step in with a defined risk below the
support to position for a rally back into the 1.18 handle. The sellers, on the
other hand, will want to see the price breaking lower to increase the bearish
bets into the 1.14 handle next.

EURUSD Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can
see more clearly the recent price action with the euro appreciating on lower
French political risk and then giving back everything as the US dollar strengthened
after Trump’s comments. There’s not much else we can add here as the buyers
will look for a bounce around the support, while the sellers will target a
breakout.

EURUSD Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can see that we might be forming a range at the
support zone with the minor resistance standing around the 1.1620 level. As a
reminder, we have the US CPI and US Flash PMIs tomorrow, so there’s a risk of
seeing some fakeouts. The red lines define average daily range for today.

Upcoming
Catalysts

Tomorrow we will get the US CPI report, and the Eurozone and US Flash PMIs.

This article was written by Giuseppe Dellamotta at investinglive.com.

WTI crude oil is up 4% on the day to $61.75 and is nearly up 8% on the week now, as prices are showing a resurgence after having hit its lowest since May on Monday. This comes after the US announced sanctions against Russia’s two largest oil companies and the EU also announcing sanctions against two independent Chinese oil refineries, which have heavily contributed in helping Russia to circumvent previous sanctions.

That’s all helping to see oil produce a strong rebound this week, with WTI crude oil now trading up to its highest in two weeks. In the bigger picture, the 100 (red line) and 200-day (blue line) moving averages will remain key ceilings for the price momentum to shake off the bearish momentum so far in 2H 2025.

This article was written by Justin Low at investinglive.com.

The US Dollar keeps heading north against a weaker Japanese Yen on Thursday.