| Wrap Up |
| The Canadian dollar edged lower against its U.S. counterpart, extending its pullback from a near two-week high the previous day, as investors mulled the prospect of a surprise interest rate cut next week from the Bank of Canada. The BoC has stayed on the sidelines in recent months even as other central banks, such as the Federal Reserve, have eased interest rates. The price of oil, one of Canada’s major exports, rose after a larger-than-expected decline in U.S. crude stockpiles helped ease worries about weakening oil demand caused by the trade war between the United States and China. Canadian government bond prices were mixed across the yield curve, with the two-year bond up 1 Canadian cent to yield 1.333% and the 10-year bond falling 6 Canadian cents to yield 1.131%. |
| Levels and recommendations |
| Signs that Italy’s latest political drama was over and hopeful noises from China in its trade war with the United States pushed global share markets higher and paused the relentless steamrolling of global bond yields. The British pound steadied at $1.22 after Prime Minister Boris Johnson’s plan to suspend Britain’s parliament re-aggravated worries that Britain could leave the European Union without a transition deal. The Chinese yuan also managed to snap a 10-day losing streak although only thanks to a late rebound as Beijing said it and Washington were discussing the next round of face-to-face trade talks in September. The Canadian dollar is trading flat ahead of Bank of Canada decision on interest rate which is due on 4th September. Markets are anticipating no interest rate cut in its upcoming policy and its decision would largely depend on domestic GDP data which is due on Friday. The USDCAD is expected to trade in the narrow range of 1.3285-1.3315 levels for the day. |