Canadian Dollar Trapped in Choppy Market Day
The Canadian dollar is experiencing a choppy market day, consolidating its gains from yesterday's month-end demand selling of USDCAD. The direction of the Canadian dollar remains tied to prevailing US risk sentiment, fueled by rapidly rising global bond yields and traders awaiting the Bank of Canada's monetary policy decision tomorrow.
Meanwhile, equity indexes are retreating globally, with Asian markets mostly finishing lower except for Japan's Topix. The German Dax is down 1.11%, the UK FTSE 100 is off 0.83%, and the French CAC 40 has dropped by 0.38%. US futures point to a 0.57% drop in the S&P 500.
Rising bond yields are driving market reaction, with the 10-year Treasury yield sitting at 4.7872 and the DXY at 99.60. Eurozone HICP inflation came in at 3.3% year over year for August, matching forecasts but still above the ECB's target.
The USDCAD opened at 1.3869 with an overnight range of 1.3845-1.3877 and closed at 1.3854. WTI is trading at 87.95, while Gold sits at 4,366.48.