The Morning Update

The USD steadies, oil prices firm, equity markets and US yields are mixed amid Fed speculation and US Thanksgiving. The dollar steadies in thin trading as U.S. markets remain closed for the Thanksgiving holiday, limiting liquidity and dampening volatility. With the greenback still on track for its biggest weekly drop in four months, investors remain focused on the rising likelihood of a December Fed rate cut. Currencies such as the yen, kiwi, and aussie are seeing modest moves, but overall activity is subdued heading into the long U.S. weekend. Global equity markets are mixed, with the MSCI All Country World Index holding steady after a four-day rally driven by rising expectations of a December Fed rate cut. Asian and European markets saw modest, uneven moves, while U.S. trading remains closed for Thanksgiving and futures are little changed. Overall sentiment has improved, but gains are more selective as investors weigh stretched valuations against renewed optimism on the policy outlook. Elsewhere, oil prices are steady after rebounding from one-month lows, while gold has slipped slightly as risk appetite improves. Bitcoin is outperforming, rallying towards $92,000 level in the past 24 hours as crypto demand strengthens. With the US Thanksgiving holiday, the economic calendar is quiet, with investors focusing on the CAD Currency Account Q3, and the ECB Monetary Policy Meeting Accounts to help provide some direction to currency markets.

‍

In the news. The EU's frozen-assets loan plan risks rattling markets, Euroclear warns. Swiss politicians decry 'gold bar diplomacy' in Trump trade deal. Net migration to the UK plummets by two-thirds to 204,000. Business chides Reeves for not kick-starting growth in the Budget. Canada unveils more measures to protect tariff-hit steel and lumber sectors. US airports hit by disruptions ahead of Thanksgiving travel boom. China warns of nuclear conflict risks after Trump orders testing. France's Macron, eyeing geopolitical threats, unveils voluntary military service. Stocks gain as investors bet on Fed rate cuts, while the yen is locked in an intervention zone.

In currency markets. The New Zealand dollar is outperforming, boosted by a hawkish shift from the RBNZ and stronger domestic data that have markets now pricing the next rate hike by late 2026. The Australian dollar is also firmer as hotter-than-expected inflation data reduce expectations of further RBA cuts, with high Australian yields and a stronger yuan offering additional support. The yen remains weak and near intervention-sensitive levels, with thin U.S. Thanksgiving liquidity increasing the risk of sharper moves.

‍

In commodity markets. Oil & Silver prices rose 0.35%. Natural Gas prices gained 0.7%. Gold prices fell 0.35%. Copper prices eased 0.5%. Coffee prices weakened by 0.9%. Soybean and Wheat prices are flat.

‍

CAD slipped off its six-day highs after earlier strength was driven by broader USD weakness and rising expectations of a December Fed rate cut. While firmer oil prices and improved risk sentiment had helped lift the loonie, attention now shifts to Friday’s Canadian GDP data, which could influence expectations for future Bank of Canada policy moves. Canada announced new measures to support its steel and lumber sectors amid steep U.S. tariffs, including tighter import quotas and a 25% global tariff on certain steel-derivative products. Ottawa will also cut freight rates and boost domestic use of Canadian-made materials to protect jobs and help companies manage tariff-related pressures. Canada’s third-quarter current account data will be released today and could offer fresh direction for the Canadian dollar ahead of Friday’s GDP report.

‍

EURCAD slips as a rebound in oil prices offers the Canadian dollar some support ahead of today’s release of Canada’s third-quarter current account, which could provide fresh direction before Friday’s GDP report. At the same time, traders are watching for the ECB’s Monetary Policy Meeting Accounts, which may influence euro sentiment if they hint at any shift in the bank’s policy stance. With both events on deck, the pair is likely to remain sensitive to data and central-bank commentary in the near term.

‍

EUR is steady near 1.1600 as the pair consolidates its weekly gains in thin Thanksgiving-day trading, with reduced U.S. liquidity limiting volatility. The euro’s bias remains mildly bullish as price holds above key moving averages, though further upside may be capped without fresh catalysts. With no major U.S. data scheduled and markets closed, attention turns to today’s ECB Monetary Policy Meeting Accounts for any policy signals that could influence the euro's direction heading into Friday’s shortened U.S. session.

‍

GBPEUR is flat after the UK Budget, which was broadly seen as disappointing and failed to provide a boost to sterling. Markets now turn to the upcoming ECB Monetary Policy Meeting Accounts and Friday’s German unemployment report, both of which could provide the next catalysts for euro movement and direction for the pair.

‍

GBP is down in early trading, snapping a five-day rally as markets refocus on weak UK fundamentals and doubts over whether the fiscal tightening announced in Wednesday’s budget will actually be delivered. GBP/USD has retreated below recent highs, pressured by lingering concerns about slow growth, weak productivity and expectations of a December BoE rate cut. A modest rebound in the US Dollar is also weighing on the pair, though dovish Fed expectations continue to cap broader USD strength. With Thanksgiving limiting U.S. liquidity and the UK budget now behind us, investors are reassessing the outlook for sterling heading into year-end.