September 18, 2026
USDCAD open: 1.3998, overnight range 1.3976-1.4015, close 1.3990
USDCAD traded higher on the back of general bullish US dollar sentiment following the Fed’s rate hike. However, it is the widening of the 2-year CAD/US spread to -143.1 and the 10-year CAD/US interest rate differentials to -112.3, doing most of the work. The divergent Fed and BoC interest rate paths and talk that foreign investors are demanding higher term premium for US bonds are a couple of reasons for the spread widening.
CIBC and Morgan Stanely are reportedly the two firms tapped by the government to advise on selling operating rights to four airports. Anyone familiar with the privatization of Ontario’s Highway 407, knows that anyway you slice it, users get screwed and the government transfers a lucrative revenue stream to the private sector.
WTI oil traded in a $99.39-$102.28 finding the low in Asia then rising in NY trading. Prices continue to consolidate above the $100.00/support zone. Reports that China is renewing exports of refined products has calmed fears of a major shortage because of Houthi actions closing the Bab el-Mandeb strait, alongside Saudi Arabia’s shipments via Oman.
There are no Canadian economic reports today. USD Industrial Production and Capacity Utilization are on tap.
USDCAD Technicals
The intraday USDCAD technicals are bullish above 1.3970. However the RSI is deeply overbought on the daily chart and, while easing off yesterday’s extreme, is still elevated on the 4-hour and the 4-hour MACD line has just slipped fractionally below its signal, an early sign the rally may need to pause here. A break above 1.4020, opens the door to 1.4050, while a move back below 1.3970 suggests a retest of 1.3910.
Longer term, the 1.3760-1.4010 range that has contained price action since the middle of July is still intact but the top if the band is being threatened. A sustained close above that level keeps 1.4150 puts 1.4250 in play.
For today, support is 1.3970 and 1.3940. Resistance is 1.4020 and 1.4050.
Today’s range 1.3970-1.4050.
FX Heat Map
FX open high low 6:00 am
Warsh is No Puppet
Fed Chair Kevin Warsh defied Trump’s demand to cut interest rates and markets gave a sigh of relief. Mr. Warsh proved he was no presidential puppet and said he was determined to get inflation to its mandated level. It worked. Global stock markets rallied Thursday and are mixed overnight while Treasury yields inched lower.
Taking Stock
Asia equity indexes were flat to higher. Japan’s Topix and Australia’s ASX 200 closed nearly unchanged while Hong Kong’s Hang Seng rose 0.60%.
As of 5:30 am PT, the German DAX, French CAC-40 and UK FTSE 100 are all down around 1.26% while S&P 500 futures are down 0.09%. The 10-year Treasury yield is 4.979%, the DXY is 100.54 and gold is $4,368.75.
EURUSD | Range 1.1455-1.1492
EURUSD traded sideways but has a negative bias due to the Fed’s somewhat hawkish pivot and expectations for another US rate hike before year end. A couple of ECB policymakers reiterated their hawkish bias but traders ignored them. President Christine Lagarde didn’t do a lot to quell speculation that she would resign before her term ends on October 27. When asked about it, all she said was “we’ll see.”
GBPUSD | Range 1.3335-1.3376
Sterling is at its session low and could not get any traction even after August Retail Sales surprised to the upside (actual 0.5% vs forecast -0.2% and July -0.5%). GBPUSD continues to be weighed down by the BoE decision to leave rates unchanged at 3.75% at yesterday’s meeting, even after the Fed and ECB raised rates.
USDJPY | Range 155.88-158.05
The Bank of Japan hiked rates to 1.25% as expected but the yen did not benefit from the move. USDJPY climbed steadily and is near its overnight peak. Policymakers Asada and Sato, who were appointed by Prime Minister Takaichi, wanted to leave rates unchanged, which raises questions about the BoJ’s resolve to hike rates again.
AUDUSD | Range 0.7108-0.7137
The Aussie stayed buoyant as broad risk appetite improved and the USDCNH touched its strongest level in roughly four years. Meanwhile, RBA Governor Bullock reiterated that getting inflation back to target remains the priority and higher-for-longer oil prices are complicating that job.
USDMXN | Range 17.1350-17.1990
USDMXN consolidated Thursday’s losses in a relatively narrow trading band overnight before extending gains in NY trading.. Mexican and US trade talks are ongoing but they are far closer to a deal than the US and Canada.
CHINA
- PBoC Fix 6.7521 vs Exp. 6.7065 (prev. 6.7580)
- Shanghai Shenzhen CSI 300 rose 1.06% to 4,507.39
The US is reported to pause new tariff announcements on China until after the Xi-Trump summit on September 24
Sources: Investing.com, Bloomberg, Reuters, Yahoo Finance, US Census Bureau, Trading Economics, Tradingview
