December 4, 2025
USDCAD open: 1.3967, overnight range 1.3948-1.3977, close 1.3950
USDCAD is consolidating its recent losses in a 1.3948-1.3975 range. FX markets are reacting to the prospect of a Kevin Hassett-led Fed whose interest views are closely aligned with Trump who wants rates at 1.05. There is also a lack of top tier data and its December, a combination know for sucking the life out of trading.
And from the “only in Canada” file, Federally appointed judges are going to court to sue the Federal government for not granting them a $28,000 raise to their $414,000/year salaries. Now these are some of the same men and women who believe that by telling a gun-thug not to carry firearms then granting he/she bail, means the world is safe because a guy willing to shoot up a nursey school would not defy a court order. And they think they are underpaid?
WTI oil prices are rangebound in a 58.99-59.42 band. The EIA reported a small increase in weekly crude stocks (actual 0.57 million barrels, forecast -1.9 million, previous 2.77 million). Canadian oil prices dropped are suffering with WCS trading at 46.60 compared to 59.21 for WTI yesterday.
Canada’s Ivey PMI data is due today.
USDCAD Technical Outlook
The intraday USDCAD technicals are unchanged. They are bearish below 1.3990 and looking to crack support in the 1.3900-1.3920 area to extend losses to 1.3860. However the intraday RSI indicates that USDCAD is oversold. A move above 1.3990 suggests a retest of the 1.4040 area.
The medium-term technicals are bullish but vulnerable especially as trading liquidity begins to lessen into the holiday season. USDCAD bears would assume control on a break below 1.3860 which would put 1.3720 in play.
For today, USDCAD support is at 1.3940 and 1.3900. Resistance is at 1.3990 and 1.4020.
Today’s Range: 1.3910-1.3990
Move Along, Nothing to See Here”
Traders were uninspired overnight and that is likely to be the case in NY trading today. Markets continue to digest the implications of a Kevin Hassett–led Fed, and the consensus is that policy would turn dovish. Economic data remains a brief distraction, as traders believe a 25 bp Fed rate cut next Wednesday is preordained. Yesterday’s ADP employment report showed a loss of 32,000 jobs, the weakest reading in 2.5 years. The November ISM Services print (52.6 vs 52.4 in October) suggests the US economy remains resilient and did nothing to alter Fed rate cut expectations.
US Job Market
Challenger, Gray and Christmas reported 71,321 jobs were cut in November which was 24% higher than November 2024. The losses were due to restructurings, and the economy with layoffs hitting the highest level for November in 14 years.
Weekly US jobless claims were 191,000 a drop of 27,000 from last week. Neither the Challenger of jobless claims data will change the narrative for a Fed rate cut next week.
Putin’s Peace Plan
Russia’s President Vladimir Putin’s peace proposal for Ukraine is simple: he wants Ukraine to hand over the entire Donbas region. “Either we liberate these territories by force of arms, or Ukrainian troops leave these territories.” Ukraine’s President Volodymyr Zelensky says no.
Taking Stock
Asian equity markets closed higher, led by a 1.92% jump in Japan’s Topix. Australia’s ASX 200 rose 0.27%, and Hong Kong’s Hang Seng index gained 0.68%.
As of 7:00 am, European markets are drifting higher with the German DAX up 0.73%. The French CAC-40 is up 0.43%, the FTSE 100 has risen 0.18%, and S&P 500 futures are flat. The US Dollar Index (DXY) is 98.80, the US 10-year Treasury yield is 4.085%, and gold (XAUUSD) is $4198.59.
EURUSD
EURUSD traded higher in a 1.1653–1.1682 range, supported by negative US dollar sentiment. The prospect of a Fed rate cut alongside unchanged ECB rates is bolstering demand for the single currency. Lack of progress in the Russia–Ukraine peace talks is limiting gains, and comments from ECB officials, including President Lagarde, were ignored. EURUSD is holding within a 10-day uptrend channel between 1.1610 and 1.1695.
GBPUSD
GBPUSD is consolidating its recent gains in a 1.3327–1.3359 range. Part of the support reflects a “relief rally” after dire predictions surrounding Chancellor Rachel Reeves’ Autumn Budget, tabled November 26, failed to materialize. The latest OECD forecast projecting UK growth of 1.2% in 2026, compared with the previous estimate of 1.0%, is also underpinning prices.
USDJPY
USDJPY fell sharply from 155.54 to 154.73, where it is trading in early NY. A Reuters report citing three sources claims the government will tolerate a 0.25% rate hike by the BoJ at the December 19 meeting. Prices were already on the defensive ahead of the expected Fed rate cut.
AUDUSD
AUDUSD drifted higher in a 0.6598–0.6620 band, supported by broad US dollar weakness and expectations that the RBA will adopt a more hawkish tone. Technicals are bullish above 0.6530 and point toward a test of resistance at 0.6700.
USDMXN
USDMXN traded in an 18.2586–18.3004 range but spiked to 18.2920 in early NY trading. The pair has been defensive due to Fed rate cut expectations and recent employment data suggesting Banxico will leave its benchmark rate unchanged. Prime Minister Claudia Sheinbaum is traveling to Washington to attend the 2026 World Cup draw.
USDMXN
USDMXN traded in an 18.2586-18.3004 range but spiked to 18.2920 in early NY trading. USDMXN has traded defensively due to US rate cut expectations and the latest employment data suggesting Banxico will leave its benchmark rate unchanged. Prime Minister Claudia Sheinbaum is traveling to Washington to attend the 2026 World Cup draw.
China
PBoC Fix: 7.0733 vs exp. 7.0554 (Prev. 7.0754)
Shanghai Shenzhen CSI 300 rose 0.34% to 4546.57
Analysts are suggesting that the PBoC is not happy with the level of USDCNY which is why the fix was sharply higher than the market expected. The analysts believe the move is merely to slow the USDCNY decline and expect prices to fall below 7.00 in early 202
FX High, Low, Open
Sources: Investing.com, Bloomberg, Reuters, Yahoo Finance, US Census Bureau, Trading Economics
