Today's expected range for the Canadian Dollar against the major currencies:
US Dollar 1.3720-1.3970
Euro 1.5890-1.6140
Sterling 1.8300-1.8550
WTI Oil (opening level) $58.62
The CAD/USD is opening at 1.3841 ( 0.7225 )
USD/CAD is firmer above key support at 1.3800.
Today’s Fed outcome will dictate whether USD/CAD clears that support stalls above it.
BOC is widely expected to keep rates on hold at 2.25%. The BOC will likely emphasize again that it sees the current policy rate at about the right level to keep inflation close to 2%.
No Monetary Policy Report or press conference will accompany this meeting. The swaps market implies a full 25bps rate increase to 2.50% over the next twelve months, which bodes well for CAD.
Headlines
· Ahead of today’s widely expected hawkish rate cut from the FOMC, bond traders are betting on a shallower path of Federal Reserve interest-rate cuts in the year ahead, with just two 25 bps cuts expected during the first half. The change is part of a global move to wager that major central banks will slow or halt their monetary easing.
· US job openings rose to a five‑month high of 7.67 million in October while layoffs climbed to 1.85 million, the highest since early 2023, and hiring fell by 218,000, with Stephen Stanley saying the labour market is slowing but not as sharply as some alternative indicators suggest.
· SpaceX, the Elon Musk-led company, is said to be moving ahead with plans for an IPO in mid-to-late 2026 that would value the company at USD 1.5 trillion and raise more than USD 30 billion, making it the largest IPO ever.
· France’s National Assembly approved next year’s social security bill by 247–234, boosting the odds of a year‑end budget and easing calls for Prime Minister Sebastien Lecornu to resign, with Lecornu saying the vote shows compromise is possible even as the main budget will be tougher and the government’s stance unchanged.
· Silver surged to a fresh record above USD 60, supported by rate-cut expectations and after The Silver Institute said demand is set to expand across key technology sectors such as solar (PV), EVs and related infrastructure, as well as data centres and AI. The gold-silver ratio has slipped to a four-year low around 68.5, marginally below its 25-year average, underscoring silver’s strong relative performance.
· Gold trades calmly around USD 4,200 ahead of today’s widely expected US rate cut. An uptrend from the October correction low offers support at USD 4,118 while resistance remains firm around USD 4,250.
· Crude trades near recent lows amid ongoing concerns about global oversupply in the coming months. In its latest monthly update, the EIA said US production hit a record this year before slowing in 2026. Meanwhile, the API reported a 4.8 million barrel draw in crude stockpiles, partly offset by a sharp build in gasoline inventories. Brent remains stuck in a narrow four-dollar range, with downside attention focused on support around USD 62.
Key Points
· Equities: Equities traded mixed, with flat U.S. and softer Europe and Asia as investors wait for the Fed and key China data
· Volatility: VIX mid-teens, short-term vols jump into Fed, SPX 0DTE implies ±0.6%
· Digital Assets: Options heavy put demand in IBIT/MSTR/miners, ETHA balanced and structured
· Fixed Income: US Treasury yields at high end of recent range ahead of FOMC
· Currencies: FX volatility extremely muted ahead of FOMC, JPY weak
· Commodities: Silver trades above USD 60 as industrial demand fuels supply concerns
· Macro events: Bank of Canada Rate Decision, FOMC rate decision