Trump Skips G7 Talks Amid Iran Crisis; Markets Mixed as BoJ Holds, US Data Disappoints

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

US Dollar        1.3450-1.3690

Euro                 1.5580-1.5810

Sterling            1.8290-1.8540

WTI Oil (opening level) $72.96

The CAD/USD is opening at 1.3564 ( 0.7372 )

Headlines

·    US President Trump left early from the G-7 summit in Toronto, skipping a series of meetings scheduled for today, purportedly to deal with the Iran-Israel crisis, as Trump told Iran to evacuate Tehran and met with his national security advisers.

·    G7 leaders agreed Monday to move forward with a draft statement aiming outlining a strategy to protect the supply of rare-earth minerals that have critical industrial applications after China’s recent move to restrain its dominant supply of these minerals and key components containing them, especially magnets, to the world.

·    The US Empire State Manufacturing Index dropped to -16 in June 2025 from -9.2 in May, below the expected -5.5, signalling worsening business conditions. It marked the weakest reading since March's -20, with declines in new orders, shipments, worsened supply availability, and unchanged delivery times.

·    The Bank of Japan left it benchmark interest rate unchanged, as expected, while saying it will east the pace of monthly bond purchases to quarterly reductions of JPY 200 billion from the current JPY 400 billion, starting from next year.

Key Points

·    Equities: US, Europe rebound; tech, banks strong; oil/energy lag

·    Volatility: VIX down, but risk remains above normal; hedging costlier

·    Digital assets: BTC steady, ETH eyes breakout; IBIT/ETHA ETF flows strong

·    Fixed Income: US yields showed little movement ahead of FOMC tomorrow

·    Currencies: Japanese yen firms after BoJ announces slower QE taper

·    Commodities: Crude prices ebb and flow with news from the Middle East