Daily Currency Update

USD - US Dollar

Last The S&P 500 reached a three-month low yesterday, and the Conference Board's consumer confidence indicator dropped to its weakest point in four months. Additionally, new home sales plummeted to a level unseen in five years. It seems likely that the US federal government is on course for a partial shutdown on October 1. Nonetheless, the US dollar remains strong, continuing to gain against G10 currencies. Despite significant losses in the US yesterday, the equity market is experiencing a rebound today, with US index futures also demonstrating a more solid bias. The bond market is steadying today after recent sell-offs. The yield on the 10-year US Treasury note is down four basis points, hovering around 4.50%. Meanwhile, the US two-year yield, close to 5.20% last week, is approximately 5.05% now, with a 20-day moving average of ~5.02%. November WTI rallied from a dip to $88.20, settling near $90.40, and has reached up to $91.60 today, almost matching last week’s yearly high of just under $92.45.

CAD - Canadian Dollar

Even though the swaps market is leaning towards a Bank of Canada rate increase in Q4, the Canadian dollar can't keep up with the US dollar. The US dollar ascended to about CAD1.3525 yesterday and is probing the lower limits of the CAD1.3540-75 range, marking the next technical goal. The CAD1.3500 zone is now acting as a support level. Given the lack of significant data releases today the USD/CAD will be influenced by general market trends.