USD/CAD Steady as Canada Avoids Tariff Targeting — Talks Extended

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

US Dollar        1.3540-1.3780

Euro                 1.5890-1.6140

Sterling            1.8430-1.8680

WTI Oil (opening level) $67.81

The CAD/USD is opening at 1.3653 ( 0.7324 )

USD/CAD remains stable. Canada was not targeted by the USA tariffs yesterday, as negotiations are given more time to reach an agreement.

Headlines

·    Trump unveiled letters that threaten to impose a 25% tariff rate on key trading partners, including Japan and South Korea, with a deadline of at least 1 August. However, in usual TACO style, he said he was open to additional negotiations and that the deadline was "not 100% firm", indicating he would look favourably on countries offering concessions. Additional tariffs of 25%–40% were imposed on 14 countries, including South Africa and Thailand. Treasury Secretary Bessent indicated upcoming trade announcements before Wednesday's deadline.

·    The Reserve Bank of Australia (RBA) surprised the market by keeping interest rates unchanged at 3.85%, saying it was waiting for “a little more information to confirm that inflation remains on track to reach 2.5 per cent on a sustainable basis amid uncertainties about US tariff plans and their impact. 

Key Points

·    Equities: Trump tariffs shake markets; Tesla tumbles; banks and German data lift EU stocks

·    Volatility: VIX jumps; short-dated vol signals near-term jitters; SPX move seen at ±0.51%

·    Digital assets: Bitcoin flat; strong ETF inflows continue; ETHA assets climb above $4.5B

·    Fixed Income: US Treasury yields climb on tariff threats and ahead of key auctions

·    Currencies: Aussie dollar jumps as RBA hold rates steady

·    Commodities: Crude shrugs off OPEC hike amid tight fundamentals; range-bound gold finds support on tariff risk