Markets are mixed this morning following Trump’s address to the nation overnight. The US dollar index is marginally higher as China-US trade talks enter a third day and Trump’s national address did nothing to break the US government shutdown.
Dollar pairs are showing little movement so far, with the AUD/USD and GBP/USD lower, while the EUR/USD makes small gains.
The USD/CAD has continued its bear run ahead of today’s Bank of Canada meeting.
The USD/CHF is higher for the second day in a row, though the slow downtrend appears to still be on track.
Yen pairs have a more positive bias as safe haven demand ease. The USD/JPY and EUR/JPY are making slightly gains, while the AUD/JPY and GBP/JPY lag.
Meanwhile gold is slipping from the highs, but remains above $1280.
FOMC member Evans speaks at 14.00.
At 15.00, we get the BOC statement, with no change expected.
BOE governor Carney speaks at 15.30.
FOMC member Rosengren speaks at 16.30.
At 19.00, we have the release of the meeting minutes from the last FOMC meeting.
There are growing levels of expectations for a rate increase in Canada. This is almost certainly not happening this month, but traders are hoping for signals of future intent. Meanwhile, the euro continues to struggle in line with other dollar pairs (with the notable exception of the Canadian dollar).
With big downside risks, there is a good chance of downside for the EUR/CAD in coming days.