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USD/CAD Rises on Fed Cook’s Sacking, Eliciting Dollar Sentiment, Investors Await Canada GDP and Trade Negotiations

The USD/CAD currency pair rose to about 1.3850 during Wednesday’s late Asian trading following the US Dollar’s appreciation even as the Federal Reserve faced political uncertainty after President Donald Trump sacked Fed Governor Lisa Cook, who has threatened to contest the move in the courts legally. Anxiety regarding the integrity of US institutions has burdened the Greenback, with Canadian Dollar traders looking to clarity from the forthcoming US-Canada trade talks and this Friday’s release of Canada’s Q2 GDP figures to guide the Loonie’s short-term direction. KEY LOOKOUTS • Political tensions escalate following President Trump’s sacking of Fed Governor Lisa Cook, raising questions regarding the integrity of US financial institutions. • Cook’s move to sue over her firing puts additional pressure on the stability of the US Dollar. • Investors watch closely for Canadian official-US counterpart talks for possible trade concessions. • Canadian GDP and June and Q2 figures, to be released Friday, are predicted to give the Canadian Dollar new direction. USD/CAD currency pair edged up near 1.3850 on Wednesday as the US Dollar slightly benefited despite political unrest over the Federal Reserve. The confidence of the Greenback in the market has been rattled following President Trump’s sudden removal of Fed Governor Lisa Cook, leading her to seek legal recourse over the move. The political drama has left US institutions’ credibility in question, with investors now being cautious. In the meantime, the Canadian Dollar moves sideways as markets wait for developments on US-Canada trade negotiations and the release of Canada’s Q2 GDP figures, both of which are expected to shape the Loonie’s next direction. USD/CAD hovers around 1.3850 as the US Dollar resists despite Fed uncertainty following Governor Lisa Cook’s removal. Market players remain on hold until US-Canada trade talks and Canada’s Q2 GDP release later Friday. • USD/CAD ticks higher to about 1.3850 in Wednesday late Asian dealing. • US Dollar rises modestly with the DXY at 98.35 amid political uncertainty. • President Trump’s firing of Fed Governor Lisa Cook creates institutional credibility issues. • Lisa Cook will sue to overturn her firing, ratcheting up political tensions. • Market sentiment is still wary of US financial decision-making stability. • Canadian Dollar moves horizontally as investors wait for updates on US-Canada trade negotiations. • Canada’s Q2 and June GDP figures, released Friday, may take direction of the Loonie. The USD/CAD currency pair has witnessed small increases as political instability in the US continues to take its toll on investor morale. The abrupt firing of Fed Governor Lisa Cook by President Donald Trump is making the credibility and stability of US financial institutions questionable. Faced with this, Cook has announced intentions to pursue a lawsuit against her termination, putting more pressure on the market. In spite of this, the US Dollar has remained relatively strong, indicating careful optimism in investors. USD/CAD DAILY PRICE CHART SOURCE: TradingView On the Canadian side, the spotlight is on future trade talks with the United States and local economic indicators. Canadian government representatives, such as cabinet minister Dominic LeBlanc, have been in talks with American counterparts in order to obtain trade concessions, which have indicated movement toward a possible deal. In the meantime, investors are setting their sights for the announcement of Canada’s Q2 GDP figures, which should give guidance regarding the nation’s economic performance and determine the near-term direction of the Canadian Dollar. TECHNICAL ANALYSIS USD/CAD trades at 1.3850, with a light positive bias as the pair tests short-term resistance. The US Dollar Index (DXY) trading around 98.35 facilitates the Loonie pair’s small gains, while major moving averages indicate minimal momentum in either direction. The first support is expected near 1.3800, with the first resistance around 1.3900, pointing towards a likely consolidation phase till the big economic or political drivers spark a conclusive breakout. Traders can seek validation from trend and volume indicators before taking a directional view. FORECAST In the near term, USD/CAD could experience modest upside to the 1.3900 level if the US Dollar continues to find itself supported in the face of geopolitical uncertainty. Positive news in the US-Canada trade negotiations or a stronger-than-projected US economic outlook can further support the pair, prompting prudent bullish sentiments from traders. Alternatively, the pair is likely to experience downward pressure if doubts about the credibility of the US Federal Reserve grow or if Canada’s Q2 GDP figures are better than projected, a prospect that would boost the Loonie. Significant support of the order of 1.3800 would be tested under such circumstances, with further slides likely should broader market risk perception turn against the Canadian Currency.

AUD/USD Currencies

AUD/USD Remains Close to 0.6500 as Trump-Fed Spat and RBA Rate Cut Hints Determine Market Mood

AUD/USD pair increased slightly towards the all-important 0.6500 level on Tuesday after the US Dollar lost some ground following political upheaval at the Federal Reserve. President Trump sent a firing letter to Fed Governor Lisa Cook for mortgage accusations, raising fears of Fed independence and generating weak selling pressure on the Greenback. At the same time, investors look forward to the US Durable Goods Orders data, which is predicted to decline moderately, as the Australian Dollar holds firm despite an early warning of further interest rate cuts by the Reserve Bank of Australia later in the year. KEY LOOKOUTS • Trump’s decision to end Fed Governor Lisa Cook’s term sparks renewed fears over central bank independence. • The Greenback weakens, and the DXY falls 0.2% to around 98.20, which provides a boost to AUD/USD. • July Durable Goods Orders are due, which are predicted to decline by 4% compared to June’s more severe 9.3% drop. • The minutes from the RBA foreshadow further interest rate cuts during the year, with judgments subject to data received and overseas threats. AUD/USD rose moderately towards the 0.6500 level on Tuesday as a weaker US Dollar came after President Trump suddenly tried to dismiss Fed Governor Lisa Cook for mortgage charges injected political and economic volatility. The move further subjected the independence of the Fed to new doubts, putting subtle pressure on the Greenback and enabling the Aussie to make inroads. Traders now look to the coming US Durable Goods Orders report, due to indicate a lower decrease versus June, while the Australian Dollar holds firm in spite of the RBA suggesting possible rate cuts later in the year. AUD/USD inched higher towards 0.6500 after the US Dollar weakened in response to Trump’s bid to sack Fed Governor Lisa Cook, sparking fears of Fed independence. Buyers now focus on US Durable Goods Orders data, with the RBA’s hint of future rate cuts keeping the Aussie in line. • AUD/USD inches closer to the 0.6500 level during Tuesday’s European session. • US Dollar Index (DXY) down 0.2 to about 98.20, supporting the Aussie. • Trump seeks to remove Fed Governor Lisa Cook over suspected false mortgage reports. • Cook contests dismissal, insisting Trump lacks the legal power to remove her. • Fed independence is becoming increasingly cause for concern amid warnings of politcal interference. • Investors look to US Durable Goods Orders data to come through with a 4% drop for July. • RBA minutes indicate further interest rate cuts later in the year, although data will determine the pace. President Trump’s move to order Federal Reserve Governor Lisa Cook a termination letter created political controversy and reopened questions over the central bank’s independence. As Trump accused Cook of making false claims about mortgage arrangements, she dismissed the allegations and claimed that the President could not remove her. This action is part of Trump’s larger effort to have more control over the Fed, an organization he has often denounced for its policies, according to market observers and analysts. AUD/USD DAILY PRICE CHART SOURCE: TradingView In Australia, the Reserve Bank of Australia’s August meeting minutes revealed that officials remain open to additional interest rate cuts later this year. Policymakers emphasized that the timing and extent of these cuts will depend on the flow of economic data and global conditions. The RBA’s cautious but accommodative stance reflects concerns about growth and inflation, while leaving room to adjust policy based on evolving risks. TECHNICAL ANALYSIS AUD/USD is probing the psychological level around 0.6500, which has served as a pivot point in recent trading sessions. A break above this range could set the stage for further up-move towards near-term resistance levels, but its inability to stay above 0.6500 could lead to fresh selling interest. Market participants are taking keen interest in price action on this important level as it would decide short-term directional flow for the pair. FORECAST Should the US Dollar remain under selling pressure in face of political stress at the Fed and softer-than-anticipated US data, AUD/USD may gain traction above the 0.6500 level. A clean break higher would likely urge buyers to drive the pair towards near-term resistance levels, supported further if the RBA embraces a cautious rate cut pace. Conversely, any bounce of the Greenback on the back of better US economic data or reducing political turbulence would pressure the pair. Not being able to hold above the 0.6500 level could induce fresh selling, which could drive AUD/USD lower as markets also take into account the RBA’s inclination for further cuts in interest rate this year.

Currencies

USD/CAD Declines Below 1.3850 as Dollar Retreats Ahead of Highly Anticipated U.S. Jobs Report

USD/CAD pair fell below the 1.3850 level in Friday’s Asian session, trading around 1.3830, as the U.S. Dollar receded ahead of the highly anticipated Nonfarm Payrolls (NFP) report. Although the greenback had gained some strength recently, investor caution re-emerged with doubts about how current tariff measures are affecting job growth. Greater positive sentiment in the market, fueled by U.S. President Donald Trump’s positive comments on trade agreements with major Asian allies provided some relief to the USD. In contrast, softer-than-anticipated economic reports from both the U.S. and Canada—such as increasing U.S. unemployment claims and a third consecutive drop in Canada’s Manufacturing PMI—added to the conservative tone. The Bank of Canada’s recent meeting minutes also indicated a contained policy stance, dampening hopes of near-term rate reductions in spite of continued economic weakness. KEY LOOKOUTS • Market players are all eyes on Friday’s NFP reports for indications of how tariffs and trade tensions are impacting the U.S. labor market, and possibly impacting the direction of the USD. • Any breakthrough or delays in U.S. trade talks with China, India, Japan, and South Korea may determine market mood and USD strength. • While the BoC has kept rates steady in the face of sticky inflation and a robust labor market, future economic releases will be pivotal in determining future rate expectations. • Further softness in Canada’s manufacturing sector and other macro datapoints could bear down on the CAD, particularly if economic slowdown accelerates. USD/CAD pair are the following U.S. Nonfarm Payrolls report, which might offer vital information on the effects of tariffs on employment and shape Federal Reserve policy expectations. Market participants are also watching events on the trade front, as any improvement in U.S. negotiations with China, India, Japan, and South Korea might enhance risk appetite and underpin the U.S. Dollar. On the Canadian side, ongoing weakness in manufacturing—dramatized by April’s steep decline in the S&P Global Manufacturing PMI—may continue to stress the Canadian Dollar. Further, the Bank of Canada’s conservative policy tone, as embodied in its most recent meeting minutes, indicates that rate decisions will continue to be highly data-sensitive, so coming economic releases will be important for the CAD outlook. Traders are keeping a close eye on the U.S. Nonfarm Payrolls report for indications of the impact of tariffs on the labor market, which may alter USD sentiment. Poor Canadian manufacturing figures and the Bank of Canada’s conservative approach contribute to downside pressure on the CAD. Trade updates also continue to be a primary market driver. •  USD/CAD dipped below 1.3850, trading at around 1.3830 during Friday’s Asian session with a lull in the recent rally of the U.S. Dollar. • Investor attention is on the forthcoming U.S. Nonfarm Payrolls (NFP) release, which can provide insights on whether tariffs are impacting employment trends. • U.S. Initial Jobless Claims increased to 241,000, exceeding estimates and introducing caution to the economic outlook. • The U.S. ISM Manufacturing PMI fell to 48.7, still in contraction but better than predicted, providing mixed signals. •  Canada’s Manufacturing PMI dipped to 45.3 in April, lowest since May 2020, indicating ongoing sectoral weakness. • Bank of Canada left rates unchanged at 2.75%, due to sticky core inflation and a firming labor market, but left the door open for future rate cuts. • Optimistic market sentiment trailed following U.S. President Trump’s comments on the possibility of trade agreements with significant Asian economies, providing partial support to the USD. Investor sentiment in the USD/CAD cross is being influenced by a combination of economic data and geopolitical events. With the focus now shifting to the impending U.S. Nonfarm Payrolls report, markets are looking forward to gaining some insight into how existing trade policies, most notably tariffs, are potentially impacting employment and general economic activity. The latest comments from U.S. President Donald Trump hinting at possible trade deals with nations such as India, Japan, and South Korea have also alleviated some of the concerns related to trade. Moreover, news of China being willing to resume talks with the U.S. has also added to a slightly positive market sentiment. USD/CAD DAILY CHART PRICE CHART SOURCE: TradingView In Canada, economic data continues to reflect strain, especially in the manufacturing segment. S&P Global Manufacturing PMI declined for the third consecutive month in April to its weakest since the beginning of the pandemic. In spite of these conditions, the policy rate was left unchanged by the Bank of Canada due to entrenched core inflation as well as an unemployment market which proved surprisingly resistent. With both economies charting mixed data and shifting trade dynamics, market players are prudent, awaiting future economic releases and policy announcements for firmer guidance. TECHNICAL ANALYSIS USD/CAD has retreated after it failed to hold above the resistance 1.3850 level, hinting at a possible short-term consolidation. The duo is now trading around the 1.3830 level, with short-term support at 1.3800, a level that has served as a psychological floor in recent sessions. A breach below this support would pave the way towards 1.3750. On the higher side, a move above 1.3850 would be required to be sustained to restore bullish momentum, with the next resistance likely at 1.3900. Momentum tools like the RSI are turning lower, hinting at a possible continuation of range-bound behavior unless there is a robust catalyst. FORECAST Unless strong catalysts occur, like better-than-expected U.S. economic statistics on the next major releases, notably the Nonfarm Payrolls, this optimism in USD will fade and can potentially favor further downward moves to CAD. Strengthening trade sentiment, most likely should breakthroughs emerge on trade deals with China or other significant trading partners, might support positive momentum as well. Technically, a breakout above the 1.3850 resistance level could set the stage for the 1.3900–1.3950 range, particularly if risk appetite sours and investors flock to the safety of the USD. Conversely, however, if U.S. jobs data sends the wrong message or hints at slowing economic growth owing to tariff pressures, the USD could face fresh selling pressure. Dollar weakness would drag USD/CAD down,

Currencies EUR/USD

EUR/USD Falls as ECB Reduces Rates in Face of Global Trade News and Market Volatility

The EUR/USD currency pair experienced fresh selling pressure, declining back to 1.1340 following the European Central Bank (ECB) decision to make a widely expected 25 basis point cut in rates — its sixth successive reduction — as part of its ongoing campaign to nudge inflation back towards the 2% goal in the face of a weakening Eurozone economy. The ECB’s move, along with its deletion of previous language indicating interest rates are still restrictive, hints at a possible end to the easing cycle. In the meantime, optimism about U.S.-Japan trade talks gave the U.S. Dollar a boost, while doubts over U.S.-China trade ties and Federal Reserve Chairman Jerome Powell’s dovish economic outlook kept global markets on edge. In spite of the near-term retreat, EUR/USD still has a bullish technical setup, with the next significant resistance seen at 1.1500. KEY LOOKOUTS • The European Central Bank cut its key lending rates by 25 basis points but importantly avoided saying that rates will continue to be “restrictive” — suggesting that it might be ready to end its easing cycle as inflation trends improve. • Encouraging developments in trade talks between Japan and the U.S., which were highlighted by President Trump, relieved the U.S. Dollar and dampened EUR/USD recovery efforts. • Investors are looking forward to ECB President Christine Lagarde’s comments for greater insights into the central bank’s future policy direction, particularly how the continued global trade tensions affect it. •  As EUR/USD dipped below 1.1340, technical metrics such as the 14-day RSI holding above 70 and more sloping EMAs indicate the pair’s wider bullish trend is intact. The EUR/USD pair fell under renewed selling pressure, moving towards 1.1340 after the European Central Bank (ECB) declared a widely anticipated 25 basis point rate cut, its sixth in a row since the beginning of its easing cycle. The ECB’s decision reflects its ongoing efforts to tame inflation and support a slowing Eurozone economy, though the omission of any reference to rates remaining “restrictive” suggests policymakers may be eyeing a temporary pause. Meanwhile, the U.S. Dollar regained strength on the back of positive progress in U.S.-Japan trade negotiations, offering some relief to global markets amid persistent uncertainty over U.S.-China trade relations. Even with the ongoing correction, the EUR/USD pair still has a generally bullish outlook, with investors waiting anxiously for further guidance from ECB President Christine Lagarde’s next comments. EUR/USD continued to decline towards 1.1340 after the ECB trimmed interest rates by 25 basis points, as anticipated, indicating a possible end to its easing cycle. The U.S. Dollar strengthened amid positive U.S.-Japan trade news, further putting pressure on the pair. Investors now look to ECB President Lagarde’s remarks for new policy guidance. •  The European Central Bank cut its main borrowing costs as expected, its sixth consecutive reduction in response to softening Eurozone growth and cooling inflation. •  The EUR/USD currency pair fell towards 1.1340 following the rate decision, with strong selling pressure during early North American trading hours. •  For the first time in months, the ECB left out the word indicating interest rates are “restrictive,” which may indicate a possible halt to its rate-cutting cycle. •  Encouraging news from U.S.-Japan trade negotiations, led by President Trump’s announcement of “big progress,” brought relief to the U.S. Dollar. •   Markets are looking to ECB President Christine Lagarde’s comments for insight into future policy direction, particularly in the context of global trade uncertainty. •  In spite of the recent decline, the EUR/USD currency pair maintains a bullish setup with the support of higher sloping EMAs and the RSI remaining above the 70 level. •  Continued uncertainty regarding U.S.-China trade tensions continues to overshadow market sentiment, keeping traders defensive in the short term. The European Central Bank (ECB) announced yet another 25 basis point cut in interest rates, its sixth consecutive rate reduction since initiating its monetary easing cycle in June. The move is an extension of the ECB’s continued bid to stabilize the Eurozone economy as inflation makes slow progress towards its 2% target. Notably, the central bank did not reproduce its standard line that interest rates would continue to be “restrictive,” implying policymakers may be weighing a pause in additional reductions. The ECB reiterated that future policy will be “data-dependent” and influenced by the current global economic situation, specifically the uncertainty of international trade patterns. EUR/USD DAILY PRICE CHART CHART SOURCE: TradingView Meanwhile, international market focus has turned to developments in negotiations of trade talks between the United States and Japan. Favorable comments from both parties indicate better ties, providing a breath of relief for international markets that have been under pressure from tariff tensions. As the U.S.-Japan talks are progressing, however, general anxiety over the U.S.-China trade war remains, causing businesses and investors to remain guarded. As policymakers around the world adjust to these rapidly changing circumstances, market players are monitoring closely for any indication of how governments and central banks will act to protect economic stability. TECHNICAL ANALYSIS EUR/USD currency pair is undergoing a good correction after unable to maintain its momentum above the 1.1400 mark. Even after the correction, the overall trend is bullish since the price continues to trade above the major short-to-long-term Exponential Moving Averages (EMAs), indicating underlying strength. Furthermore, the 14-day Relative Strength Index (RSI) continues to remain above the 70 level, indicating that bullish momentum remains in place, though marginally overheated in the near term. Traders are currently monitoring the psychological resistance level of 1.1500, which is still a critical upside target, while the April 11 low around 1.1190 acts as a robust support level, likely to be bought if the correction worsens. FORECAST EUR/USD continues to be bullish provided the pair remains above critical technical support levels. The steepening slope of the Exponential Moving Averages (EMAs) and the Relative Strength Index (RSI) remaining above the 70 level indicate solid underlying buying demand. If the pair picks up momentum, the first target would be the psychological resistance at 1.1400, and a clear break above this level could

Currencies EUR/USD

EUR/USD Stays Put Around 1.1350 as Market Prepares for ECB Interest Rate Decision and Fed Inflation War

The EUR/USD currency pair stays put around the 1.1350 level as the US Dollar tries to regain stability as stagflation fears increase and as market sentiment turns defensive. Market participants are watching remarks from Federal Reserve officials, such as Atlanta Fed President Raphael Bostic, who noted the long way that will have to go to achieve the central bank’s 2% inflation target — a sign that rate decreases will not come as early as some had anticipated. In the meantime, everyone is focused on the next policy meeting of the European Central Bank, when a widely anticipated 25 basis point reduction in interest rates might determine the Euro’s short-term direction. Uncertainty over global trade tensions and changing projections by major financial institutions such as Deutsche Bank also contribute to the confusion, leaving market participants vigilant for any hints about the future course of monetary policy on both the Atlantic and other sides. KEY LOOKOUTS • Markets are expecting a 25 basis point rate cut in Thursday’s European Central Bank meeting, and they are looking for forward guidance on the future of monetary easing. • Federal Reserve officials, particularly Raphael Bostic, indicate that rate cuts might take a bit longer as the US central bank stays loyal to its 2% inflation target. • Market participants look for the ECB’s Bank Lending Survey for information on credit conditions, which may have implications for both the rate decision and the ECB’s economic outlook. • Increased trade uncertainty and possible US tariff changes remain weighing on market sentiment, providing near-term support for the Euro with recession fears in the US. With the EUR/USD pair trading around the 1.1350 mark, market attention turns to a number of key drivers that may decide its next direction. The European Central Bank is to make its highly anticipated policy rate decision on Thursday, with traders broadly factoring in a 25 basis point interest rate cut, while also looking for any guidance on future easing cycles. Across the Atlantic, the Federal Reserve’s measured approach to inflation — in the wake of Atlanta Fed President Raphael Bostic’s comments — indicates that the journey towards U.S. rate cuts could be slower than anticipated. The publication of the ECB’s Bank Lending Survey will also provide new clues on the state of credit in the Eurozone. At the same time, persistent global trade tensions and doubts over possible U.S. tariff shifts remain to influence investor mood, offering risk and support to the Euro in the short term. The EUR/USD pair remains anchored around 1.1350 as markets look for the ECB’s anticipated 25 basis point rate cut and more hints on monetary policy. The US Dollar, meanwhile, looks to stabilize as Fed officials remain cautious about inflation and ongoing global trade tensions. Investors look for major data and central bank comments to determine the next move. •  EUR/USD hovers around 1.1350 as the pair remains range-bound with risky market sentiment. •  The US Dollar tries to firm up as stagflation fears reemerge and dampen global risk appetite. •  Federal Reserve’s Bostic indicates a long way to go before reaching the 2% inflation goal, dashing hopes for imminent rate cuts. •  ECB to cut the rate by 25 basis points at its policy meet on Thursday, keeping the Euro in limelight. •  Deutsche Bank revises rate cut prediction for Fed, anticipating first cut in Dec 2025, two additional cuts in early 2026. •  The ECB’s Bank Lending Survey (BLS) is under the spotlight for information regarding credit conditions and the health of the Eurozone economy. • Global trade tensions and recessionary concerns continue to underpin the Euro and place pressure on the US Dollar’s rebound. The EUR/USD currency pair remains firm as market participants look towards this week’s key central bank news and economic releases. The European Central Bank is widely anticipated to cut interest rates by 25 basis points at its next policy meeting, a move designed to underpin growth throughout the Eurozone. Meanwhile, market players are monitoring the ECB’s Bank Lending Survey, which will offer useful insight into how credit conditions are influencing the region’s overall financial well-being. EUR/USD DAILY PRICE CHART CHART SOURCE: TradingView Meanwhile, the US Dollar is holding its ground as traders digest recent comments from Federal Reserve officials. Atlanta Fed President Raphael Bostic’s statement underlined that the path to bringing inflation back to the 2% target remains challenging, hinting that US rate cuts may not arrive as soon as previously expected. In addition to central bank indications, persistent global trade tensions and policy uncertainty are also exercising considerable influence over investor sentiment, with markets pricing in possible risks to the global economy in the coming months. TECHNICAL ANALYSIS EUR/USD is trading around the 1.1350 level, hinting at consolidation as the pair awaits strong directional signals. The latest price action suggests indecision surrounding major levels of resistance and support, pointing to the fact that traders wait for new sparks from central bank policies or fresh economic data to push through resolute moves. A continued penetration of near-term resistance may be enough to establish further room on the upside, but a inability to maintain present support levels would risk exposing the pair to greater bear pressure short-term. FORECAST If the European Central Bank’s forthcoming policy announcement and economic commentary succeed in finding an even keel — loosening but remaining upbeat on the recovery of the Eurozone — then the EUR/USD pair might strengthen in the near term. Surprise improvements in Eurozone economic statistics or hints at weakening US inflation might similarly prop up the Euro, sending the pair higher to resistance levels as risk appetite is regained by investors. On the flip side, if the rate cut by the ECB is coupled with a more dovish tone or the US Dollar gains new strength on the back of improved economic indicators or diminishing recession fears, EUR/USD could see fresh selling pressures. Also, ongoing global trade tensions and any rise in geopolitical tensions would tempt investors to take refuge in the