Market Brief, North America

The dollar and Treasury yields are surging, and equity markets are setting up for a strong open after new data showed the US consumer remaining alive and well in September, further reducing the need for an emergency-style response from the Federal Reserve. The Canadian dollar is taking it on the chin as expected rate differentials widen in the greenback’s favour, with a jumbo-sized rate cut at next week’s Bank of Canada now overwhelmingly favoured by economists and markets. Retail sales beat forecasts in September by a wide margin, with the headline print climbing 0.4 percent on a month-over-month basis, powered...

The dollar is edging lower this morning as geopolitical concerns ebb, but continues to hold gains achieved over the first two weeks of October, remaining higher against all of its major counterparts excepting the safe-have Swiss franc. Easing expectations fell further in yesterday’s session when Federal Reserve Governor Christopher Waller clearly indicated a preference for cutting rates in smaller-sized increments. “I view the totality of the data as saying monetary policy should proceed with more caution on the pace of rate cuts than was needed at the September meeting,” he said, noting that if the current trajectory of inflation and...

The dollar is recovering, ten-year Treasury yields are pushing higher, and risk sentiment is worsening as traders further downgrade odds on rate cuts from the Federal Reserve, forcing investors to brace for a modest tightening in financial conditions. The Canadian dollar is surging on an unexpectedly-strong jobs report, which is also lowering expectations for an accelerated pace of monetary easing in coming months. The Bureau of Labor Statistics yesterday reported an unexpectedly-large increase in underlying inflation. The core consumer price index – which excludes food and energy costs – climbed 0.3 percent month-over-month in September, reversing a period of declines...