Canadian Dollar Holds Ground Amid US Yield Pressure and Trade Uncertainty

The Canadian dollar is holding steady after recent losses, though it remains under pressure due to rising US Treasury yields. The 10-year yield dipped slightly from 5.33% overnight to 5.26% in early New York trading, offering some relief to the Loonie. However, stalled Canada-US trade talks and a strong US dollar continue to weigh on the currency.

WTI oil prices are fluctuating between $87.12 and $90.04, hovering near the lower end of this range. Middle East crude exports have rebounded, surpassing pre-war levels in late September, which may contribute to downward pressure on oil prices.

Key economic data releases are on the horizon, including Canada's August merchandise trade balance and Ivey PMI, as well as US trade deficit numbers. The US 10-year Treasury yield remains elevated, supporting the US dollar against other major currencies like the euro and British pound.

Global markets showed gains, with Asian stocks closing higher and European indices trending up in early trading. The US dollar index (DXY) sits at 101.85, while the euro and pound sterling see modest movements. The Australian dollar remains stable, with lingering speculation about potential rate hikes by the Reserve Bank of Australia.