- Trump threatens France with new tariffs
- Gold prices surge on safe-haven demand
- US dollar under pressure across the board
USDCAD open: 1.3826, overnight range 1.3825-1.3879, close 1.3872, WTI 59.61, Gold 4726.90
The Canadian dollar rallied overnight as it appears traders have soured on America, at least for today.
Renewed tariff rhetoric and invasion threats have unsettled markets and revived talk of a “Sell America” trade. The US dollar weakened broadly, global equity markets sold off, US Treasury yields moved higher, and gold surged.
The Bank of Canada’s Business Outlook Survey and the Survey of Consumer Expectations provided no fresh catalyst to challenge the Bank’s view that interest rates will remain on hold for the foreseeable future.
WTI crude is trading near the upper end of its 58.73–59.98 range, though some profit taking has emerged amid uncertainty surrounding Trump’s presence in Davos and renewed noise around Greenland.
His proposed Donald J. Trump Board of Peace, billed as an alternative to the United Nations, has failed to generate the enthusiasm he expected. Invitations went out to numerous world leaders, but many declined. French President Emmanuel Macron was among them and, in response, Trump has threatened a 200% tariff on French wines and champagne.
Asian equity markets extended the previous day’s losses. Hong Kong’s Hang Seng slipped 0.20%, Australia’s ASX 200 fell 0.66%, and Japan’s Topix declined 0.84%.
As of 7:40 am, European markets were sharply lower. Germany’s DAX was down 1.57%, France’s CAC 40 lost 1.16%, and the UK’s FTSE 100 fell 1.09%. S&P 500 futures were lower by 1.46%, the US Dollar Index slipped to 98.44, the US 10-year yield stood at 4.286%,
EURUSD traded in a 1.1633–1.1733 range, surging after breaking above the December 23 downtrend line near 1.1670 and triggering stop-loss buying. Markets largely shrugged off Trump’s tariff threats on French wine. The euro also drew support from the ECB’s modestly hawkish stance, with rates on hold as the Fed remains in easing mode. Better-than-expected ZEW data added momentum, with German sentiment jumping 13.8 points to 59.6 and the Eurozone reading rising 7.1 points to 40.8.
GBPUSD rose in a 1.3410–1.3491 range but eased back from the highs. UK unemployment held steady at 5.1% and employment data pointed to a cooling labour market. That release was overshadowed by broader market turmoil linked to Trump. Intraday technicals remain bullish after the break above 1.3440 ended the 2026 downtrend.
USDJPY traded in a 157.56–158.60 range and is near 157.74 in New York. JGB yields jumped on plans to raise taxes, while broad US dollar weakness and renewed safe-haven demand for the yen weighed on the pair.
AUDUSD traded in a 0.6707–0.6748 range, supported by broad US dollar softness and an additional lift from sharply higher gold prices.
The US and Canadian economic calendars are empty.
