Canadian Dollar Update, July 15, 2026 – Canadian Dollar awaiting BoC decision

Canadian Dollar awaiting BoC decision

• Tame US inflation weighs on greenback
• BoC expected to leave rates unchanged
• US on the defensive as Fed rate hike odds for July fade

USDCAD open: 1.4061, overnight range 1.4040-1.4068, close 1.4160, WTI 80.06, Gold 4,029.22

The Canadian dollar has managed to hang on to its recent gains thanks to better-than-expected US inflation data which reduced the risk that the Fed would raise rates in July.  Traders are content to await the Bank of Canada decision and review the updated forecasts in the MPR.

The BoC  is expected to leave interest rates unchanged, and likely saying that “economic activity in Canada has been weak and uncertainty about US trade policy persists” and that “the conflict in the Middle East is ongoing and oil prices remain elevated.”  That’s what they said last month and nothing has changed.

WTI traded sideways in a 79.30-80.84 range, supported by the US-Iran conflict as well as sharply weaker demand out of China, where crude processing at refineries has fallen to levels last seen during the 2020 pandemic.

Canadian manufacturing sales and wholesale sales data are due later today. In the US, June Producer Price data is on tap.  (forecast 0.0% m/m, vs 1.1% rise in May, while ex-food and energy is expected to be unchanged at 0.4% m/m)

EURUSD held a tight 1.1415 to 1.1444 range overnight, consolidating Tuesday’s post-CPI gains. A negative bias crept in as oil prices stayed elevated, while weaker-than-expected Eurozone industrial production (actual -0.2% m/m versus a forecast of 0.2%) kept a lid on topside progress.

Equity markets in Asia finished higher, with Hong Kong’s Hang Seng leading the region on a 1.40% advance. Japan’s Topix added 1.22% while Australia’s ASX 200 edged up 0.37%.

As of 7:20 am European bourses are negative. The German Dax is down 0.85%, the French CAC-40 is down 0.28% and the UK FTSE 100 has lost 0.27%. S&P 500 futures are up 0.13%, the 10-year Treasury yield is 4.609%, and the DXY is at 100.97.

EURUSD traded quietly in a 1.1415-1.1444 range as it consolidated Tuesday’s post-US CPI gains. Gains were capped by weaker-than-expected Eurozone industrial production (actual -0.2% m/m versus a forecast of 0.2%)and firm to steady oil prices.

GBPUSD traded in 1.3381-1.3420 range with the top seen in Asia. Prices are tracking broad dollar sentiment and awaiting today’s US PPI numbers.

USDJPY inched higher in a 161.97-162.42 band after Tuesday’s US inflation data eased fears of an imminent Fed hike. Firm crude prices and scaled back expectations that Japanese pension funds will repatriate capital continue to underpin the pair. Domestic data disappointed with May machinery orders sliding 12.4% after April’s 8.7% increase.

The Aussie drifted in a 0.6970 to 0.6993 range, supported by improved risk appetite following Tuesday’s soft US inflation print. Gains were capped by lingering US-Iran hostilities and firm oil prices.