The Morning Update

The USD holds steady, oil prices remain firm, while equity markets and US yields are mixed following the Senate's passage of a bill to end the government shutdown. The U.S. dollar held steady in early trading, rising modestly against the yen and Australian dollar as traders turned their attention to upcoming U.S. economic data expected once the government reopens. The yen weakened after Japan’s new prime minister urged caution on rate hikes, while the Australian dollar slipped amid fading risk appetite. Meanwhile, optimism surrounding a potential resolution to the U.S. shutdown helped stabilize market sentiment and supported modest gains in the greenback. Asian markets were under pressure as investors digested renewed volatility in tech shares and the lingering economic impact of the nearly six-week U.S. government shutdown. In contrast, European markets advanced on easing rate expectations. U.S. futures traded lower after the Senate passed a compromise bill to end the shutdown, which now heads to the House for approval before reaching President Trump. Economists estimate the closure may have shaved up to one percentage point off fourth-quarter GDP, though markets are looking ahead to a likely rebound once the government fully reopens. Elsewhere, oil prices rose as steady demand expectations and a softer U.S. dollar supported crude, while gold firmed on renewed safe-haven interest amid global uncertainty. Bitcoin, however, weakened, pressured by fading risk appetite and growing investor preference for traditional assets. Today's economic calendar is quiet, with CAD closed for Remembrance Day, so the focus will be on the US ADP Employment report and ECB & Fed speakers to help steer currency market direction.

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In the news. The Senate passes a bill to end the government shutdown and sends it to the House. The US & Switzerland are working on a deal to slash 39% tariffs. SoftBank sells its entire stake in Nvidia for $5.83 billion. Worsening UK labour market bolsters bets on Bank of England rate cut. Bulgaria has only one month of gasoline supplies remaining as US sanctions loom, the state reserve agency says. Partition of Gaza a looming risk as Trump's plan falters. Canadian insurer creates London unit to manage $178 billion. Canadian Conservative leader faces party unrest as Trump divides the party. Canada loses measles elimination status, wth US on track to follow.

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In currency markets. The Swiss franc strengthened for a fourth straight session, supported by optimism over progress in U.S.–Switzerland tariff talks. In contrast, the Japanese yen weakened as Japan’s new prime minister urged a cautious approach to tightening monetary policy, highlighting the growing divergence between the Bank of Japan and other major central banks. CNY is flat, while Asian currencies firm 0.1% on average against the USD. Trading currencies rebound, with KWD down 0.1%, ZAR, MXN, JPY & NZD flat, DKK, CZK, AUD and PLN up 0.15%, CZK & SEK up 0.25%, CHF & NOK strengthened 0.35% against USD.

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In commodity markets. Oil prices firmed 0.35%. Natural Gas & Copper prices weakened 0.7%. Gold prices strengthened 0.65%. Silver prices rallied 1%. Coffee & Soybean prices fell 0.3%, and Wheat prices are flat.

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CAD held steady in quiet Monday trading, with Canadian markets essentially closed for Remembrance Day. The loonie remained near a 10-day high, supported by stronger risk appetite and last week’s upbeat domestic jobs data, which showed solid employment gains and a drop in unemployment. Investors continue to view Canada’s pro-growth federal budget and steady commodity prices as supportive for the currency. At the same time, attention turns to the Bank of Canada’s next policy decision and the final budget vote scheduled for November 17. Canada’s Agriculture Minister, Heath MacDonald, said relations with China are improving following his recent visit, raising optimism that restrictions on Canadian canola exports could soon ease, as both countries signal a willingness to rebuild trade ties.

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EURCAD pair is firming in early trading amid fresh remarks from Christine Lagarde, President of the European Central Bank, who reiterated that policy is in a “good place” but emphasized that decisions will remain highly data-dependent and flexible given current economic uncertainty. Lagarde noted the bank’s focus on balancing the risks of inflation undershooting versus overshooting its 2% target, a stance that softens expectations for any near-term rate path change. Meanwhile, with the Bank of Canada still expected to ease and Canadian economic data showing signs of weakening, EUR/CAD is finding support as the loonie remains under pressure.

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EUR firmed after ECB President Christine Lagarde said monetary policy is “in a good place,” with inflation near target and no urgency for further easing, even as the German ZEW Economic Sentiment Index slipped to 38.5 in November. Lagarde reiterated that policy decisions will remain data-dependent and assessed meeting by meeting amid global uncertainty. Despite softer German sentiment data, the euro held firm as investors await today’s U.S. ADP employment figures, which could guide short-term direction for EUR/USD.

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GBPEUR weakens as UK labour market data showed rising unemployment and slowing wage growth, increasing expectations of BoE rate cuts. In contrast, the Euro held firmer as the ECB maintained a steadier policy outlook, highlighting a widening divergence between the two central banks.

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GBP comes under selling pressure after data showed the UK labour market weakened further, with unemployment rising to 5.0% and wage growth slowing to 4.6%. The sharp drop in payrolls for both September and October reinforced expectations that the Bank of England could deliver a rate cut as soon as December. Markets now price in around 65 basis points of BoE easing by the end of next year as signs of cooling pay pressures and slowing demand continue to mount.