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Canadian Dollar Update, July 3, 2026 – Canadian Dollar could rally further

Published by KnightsbridgeFX
July 3, 2026 | Daily Update

Canadian Dollar could rally further

  • US markets closed-expect quiet trading, thin markets.
  • Fed rate hike speculation pushed downstream.
  • US dollar opens mixed to modestly lower

 

USDCAD open: 1.4196, overnight range 1.4160-1.4198, close 1.4186, WTI 68.72, Gold 4,172.04

The Canadian dollar climbed on the back of a broad US dollar selloff after this  week’s American employment reports painted a jobs market, and by extension an economy, more resilient than expected. Its good news for the Canadian dollar as the technical outlook suggests further gains if prices can stay below the USDCAD level of 1.4205

WTI oil held in a softer 68.17-69.26 range. Citi analysts expect further downside as flows normalize, a call that reads as fairly self-evident.

No Canadian economic data is scheduled for release today. US markets are closed today for July 4 celebrations.

Asian equities closed higher across the board, led by a 1.28% gain in Hong Kong’s Hang Seng. Australia’s ASX 200 added 1.37% and Japan’s Topix rose 1.24%.

As of 7:30 am, European bourses are mixed with the German Dax gaining 0.39% and the UK FTSE 100 the French CAC 40 are unchanged. S&P 500 futures pointed to a 0.28% gain, the 10-year Treasury yield is 4.478%, and the DXY is 100.71.

EURUSD drifted in a 1.1420-1.1463 band underpinned by yesterdays soft US jobs data. Support also came from Eurozone Composite (50 versus May’s 48.5) and Services PMI (49.4 versus May’s 47.7) readings which point to a stabilizing economy.

GBPUSD drifted sideways in a 1.3335-1.3381 range, with the upside likely capped near 1.3410. Prime Minister-in-waiting,  Andy Burnham, is helping the cap it  by floating tax hikes to fund more spending. Sterling bulls got no lift from UK Services PMI either, which fell to 48.8 in June from 49.3 in May. S&P Global Markets noted that June data confirmed a clear loss of momentum for the UK economy.

USDJPY eased in a 160.49-161.51 range following the softer US data on Thursday.  Traders are on high alert believing that the  BoJ  may exploit today’s thinner US holiday liquidity for a sneaky intervention.

AUDUSD firmed within a 0.6911-0.6950 range, extending yesterday’s advance and picking up further support from the latest Chinese services data.