CANADA FX DEBT-Canadian dollar steadies as bearish bets on the currency hit a five-month high
By Fergal Smith
TORONTO, Sept 8 (Reuters) - The Canadian dollar was barely changed against its U.S. counterpart on Monday ahead of key U.S. inflation data this week and after speculators raised their bearish bets on the Canadian currency to the highest level since April.
The loonie CAD= was trading nearly unchanged at 1.3825 per U.S. dollar, or 72.33 U.S. cents, after moving in a range of 1.3789 to 1.3844. On Friday, the currency touched its weakest intraday level since August 27 at 1.3854.
"Currency markets are back in consolidation mode as investors keep an eye on international developments and await inflation data that could alter U.S. monetary policy expectations across the front end of the curve," Karl Schamotta, chief market strategist at Corpay, said in a note.
The U.S. consumer price index report for August is set for release on Thursday. It follows disappointing U.S. and Canadian jobs data on Friday that raised expectations for interest-rate cuts on both sides of the border and led to declines for the loonie and the U.S. dollar against other Group of Ten currencies.
"The gap between Canadian and U.S. unemployment rates, which has proven a relatively strong predictor of long-term moves in currency markets, has widened in recent months, adding to the bear case against the loonie even as problems south of the border have contributed to the greenback’s broader decline," Schamotta said.
At 7.1% in August, Canada's unemployment rate stands well above the 4.3% rate in the United States.
Separate data on Friday, from the U.S. Commodity Futures Trading Commission, showed net short positions in the Canadian dollar held by non-commercial accounts had climbed to 108,976 contracts as of September 2 from 105,015 in the prior week. 1090741NNET.
The price of oil rose 0.7% to $62.29 a barrel after producer group OPEC+ opted for a modest output hike. Oil is one of Canada's major exports.
The Canadian 10-year yield CA10YT=RR was down 3.7 basis points at 3.230%, after touching its lowest level since June 3 at 3.214%.
Related Articles
Japan Q2 GDP Commentary: Growth Revised Upward, Yen May Rise
TradingKey - On 8 September 2025, Japan released the revised Q2 GDP figures. The data showed that real GDP grew by 0.5% quarter-on-quarter, surpassing market expectations of 0.3% and the previous quarter’s 0% growth.
Fed Rates to Cut: How Will Multi-Asset Prices Move?
Currently, against the backdrop of a weakening labour market and inflation meeting expectations while remaining manageable, the Federal Reserve is anticipated to restart its rate-cutting cycle on 17 September 2025. This article analyses the impact of this round of rate cuts on U.S. equities, cryptoc
U.S. August Nonfarm Payroll Preview: Risks Focus on Downward Revision of July Data
TradingKey - On 5 September 2025, the U.S. Department of Labour will release the August Non-Farm Payrolls report. The market widely expects August to see an addition of 75,000 non-farm jobs, roughly in line with July’s 73,000.
Unlocking Gold’s Next Leg: $4,000 in Reach by 2025？
TradingKey - Gold has kicked off a fresh uptrend in early September, breaking out of months of compression and reclaiming key territory. The decisive move above $3,500 establishes a new support base and puts higher objectives back on the table for the weeks ahead
US NFP Nightmares Preview: A Tiny August Revision, a Huge Annual Benchmark Cut And a Fed in Flux
TradingKey - Wall Street expects modest job growth and a rebound in the unemployment rate in August NFP report, a balanced outcome that could support a September rate cut. However, a massive downward revision — a “terrifying scene” — and anomalies on the supply side could plunge the Fed into deeper (1).jpg)
