| Wrap Up |
| The Canadian dollar steadied against its U.S. counterpart, trimming earlier gains as investor appetite for risk decreased ahead of a Federal Reserve central banking conference this week. U.S. stocks were mixed on the first contraction in the manufacturing sector in nearly a decade and uncertainty about future interest rate cuts. Fed Chair Jerome Powell’s speech in Jackson Hole, Wyoming, could indicate whether the U.S. central bank will continue to cut interest rates, which could also help guide expectations about the Bank of Canada’s interest rate decision. Canadian government bond prices were lower across the yield curve, with the two-year bond down 9.5 Canadian cents to yield 1.458% and the 10-year bond falling 43 Canadian cents to yield 1.267%. |
| Levels and recommendations |
| Global stock markets and the dollar rose as investors looked to a speech by Federal Reserve chair Jerome Powell for clarification on whether the U.S. central bank remains on course to deliver another interest rate cut in next month. The euro eased marginally to $1.1053 as survey showing a surprise uptick in euro zone business growth for August was offset by trade war fears, knocking future expectations to their weakest in over six years. The British pound fell $1.2215 as investors reassessed whether British Prime Minister Boris Johnson had made any progress in convincing the European Union to renegotiate on Brexit. The Canadian dollar is trading flat at 1.3305 levels despite better than expected domestic retail sales data came in for the month of July. Loonie was in pressure due to sudden drop in crude oil prices triggered by news that China will slap tariffs also on US oil in addition to retaliatory tariffs on another $75 billion worth of US goods. The USDCAD pair is expected to trade in the range of 1.3275-1.3325 levels for the day. |