USD / CAD - Canadian dollar inching higher
- Caution as G-7 meets in Alberta
- WTI oil consolidating gains
- US dollar slips as safe-haven fears ease.
USDCAD: open 1.3572, overnight range 1.3570-1.3607, close 1.3582, WTI 70.85, Gold 3412.56
The Canadian rallied Friday and consolidated the gains overnight but it still maintains a bullish bias. Demand for the Loonie stems from the resurgence in oil prices and hopes for a more-oil friendly Carney government.
WTI oil jumped to 77.62 last week after Israel attacked Iranian nuclear sites but the rally stalled an price retreated to 70.79 in NY. The crude gains have underpinned USDCAD to a degree after the Carney government appeared more open to new pipelines.
G-7 leaders have touched down in Kananaskis, tucked into the Canadian Rockies, for their annual summit. The headline issues include the Israel-Iran conflict, tariff disputes, and how best to handle the unpredictable U.S. President.
Trump remains at odds with the rest of the G-7. While they continue to support Ukraine, he portrays Russia as the aggrieved party. He’s also maintaining tariff pressure on nearly all summit participants. For Trump, it’s less diplomacy and more performance art.
Markets, however, are largely unfazed. Japan’s Topix rose 0.75%, Hong Kong’s Hang Seng added 0.70%, and Australia’s ASX 200 was flat. In Europe, the CAC 40 climbed 0.69%, while the FTSE 100 advanced 0.38%. S&P 500 futures are higher, and Treasury yields are steady. Gold has retreated from its highs and is sitting well off last week’s peak.
EURUSD traded in a 1.1524–1.1587 band as it held onto recent gains with a mild upside tilt. Traders remain cautious ahead of G-7 developments and continue to monitor energy prices and military headlines out of Eastern Europe and the Middle East. ECB official Luis de Guindos dismissed concerns about euro appreciation or inflation shortfalls, while S&P maintained Germany’s top-tier credit rating.
GBPUSD ranged between 1.3535 and 1.3593 as it maintained a modest uptrend that began in mid-April. The soft Rightmove House Price Index (-0.3%) was largely ignored. Attention is shifting toward Thursday’s Bank of England meeting, where no changes to policy or forecasts are expected.
USDJPY moved within a 143.94–144.75 range in another session of sideways price action. Traders are holding fire ahead of the Bank of Japan’s upcoming decision. Rates are expected to remain unchanged, though adjustments to JGB purchases or forward guidance could create market ripples.
AUDUSD bounced around inside a 0.6466–0.6516 channel, continuing the pattern that has defined most of June. Despite escalating tensions in the Middle East, there was little demand for safe-haven flows, helping the Aussie hold its US Empire State manufacturing index.
Canada May housing starts are ahead.
