The Bank of Canada is widely expected to cut its Overnight Rate at its policy meeting by 0.25% to 4.75%.
- The Bank of Canada will be holding a policy meeting today at which it is expected to cut the Overnight Rate from 5.00% to 4.75% ahead of the European Central Bank making a similar cut tomorrow. If the Bank passes on the cut, it will be a major hawkish surprise for the Loonie (Canadian Dollar). Conversely, if the cut is stronger, say 0.50%, it will be a major dovish surprise.
- The market continues to take a more dovish expectation on the pace of US rate cuts as there are increasing economic indications that the US economy is really starting to cool down. 65% now expect the Fed to cut rates by 0.25% at its policy meeting in September after yesterday’s JOLTS Job Openings data showed its lowest reading in 3 years. This has boosted stocks, but the US Dollar has recovered slightly over the past couple of days.
- Indian markets are showing continued volatility following the election results from the weekend, it is now clear the government has won election but without a landslide. The Indian Rupee has gained over the past day, with the benchmark USD/INR currency pair falling to 83.43.
- In the Forex market, the strongest major currency since the Tokyo open is the Australian Dollar, while the Japanese Yen is the weakest major currency, putting the AUD/JPY currency cross in focus. The Japanese Yen advanced very strongly yesterday and is now bouncing back on a similarly high level of volatility, making the Yen very interesting to traders, especially Forex day traders.
- WTI Crude Oil futures are trading near a 4-month low amid increasing evidence US stockpiles are rising.
- The precious metal Silver has finally broker below the pivotal support level at $29.85. Trend traders will probably want to be exiting any long trades here now.
- Yesterday’s release of Swiss CPI data came in exactly as expected, holding steady at a monthly rate of 0.3%.
- Australian GDP data released a few hours ago came in lower than expected, showing annualized growth of only 1.4%.
- There will be a release of the ADP Non-Farm Payrolls forecast in the USA later today, followed by ISM Services PMI data.
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