Dollar Rally Builds Momentum on Positive Sentiment

28.05.2025

Today's expected range for the Canadian Dollar against the major currencies:

US Dollar 1.3710-1.3950

Euro 1.5530-1.5760

Sterling 1.8530-1.8750

WTI Oil (opening level) $61.53

The CAD/USD is opening at 1.3830 ( 0.7230 )

USD is showing a moderate advance on Wednesday, extending gains after Tuesday’s rebound. Upbeat US Consumer Confidence data and easing fears about trade wars are supporting the Greenback, with the release of the Fed minutes on focus.

Headlines

· New Zealand’s Reserve Bank cut its Official Cash Rate by 25 basis points to 3.25% as universally expected, though the market was somewhat surprised by a dissenting hawkish vote and notes that not cutting rates at the meeting was discussed. See more under currencies below.

· Australia’s April CPI rose 2.4% YoY vs. 2.3% expected and 2.4% in March, while the core, Trimmed Mean measure rose 2.8% YoY vs. 2.7% in March.

· The EU aims to 'fast track' trade talks with the US amid tariff disputes. An EU Commission spokesman stated that a call between President von der Leyen and President Trump has renewed momentum for negotiations, with both agreeing to expedite talks and maintain close contact.

· Germany has given Ukraine the green light to strike deep in Russian territory after Russian missile and drone attack in Kyiv kills 12.

Key Points

· Equities: Trump delays tariffs; global stocks rally; tech and defense lead

· Volatility: VIX declines strongly; focus shifts to NVDA earnings, macro data

· Digital assets: BTC stable near highs; IBIT ETF inflows; crypto stocks surge

· Fixed Income: Weak 40-year JGB auction demand overnight despite reduced auction size

· Currencies: USD rebound continues. NZD firms on more hawkish than expected RBNZ

· Commodities: Gold drifts lower. Another false dawn for uranium?

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