USD / CAD - Canadian dollar gets a boost

- Sinking Treasury yields boost Loonie. - US Q2 GDP and weekly jobless claims data ahead. - US dollar attempting to recoup some of yesterday’s losses. USDCAD open 1.3772, overnight range 1.3768-1.3792, close 1.3794, WTI 63.80, Gold 3399.09 The Canadian dollar rallied yesterday after ongoing White House and Fed drama drove Treasury yields lower. The pressure on the Fed to lower rates has intensified to such an extent that even Chair Powell opined about cutting rates. WTI oil firmed in a 63.51-64.02 range. The EIA reported that weekly crude inventory data fell by 2.392 million barrels and talk that Britain, France and Germany are discussing reviving Iran sanctions supported prices. Asian equity markets were mixed to higher. Japan’s Topix rose 0.65%, Australia’s ASX200 gained 0.22%, while Hong Kong’s Hang Seng slid 0.81%. In early European trade, the French CAC-40 was unchanged, the FTSE 100 dipped 0.47%, and the German DAX eased 0.19%. S&P 500 futures were flat, and the US 10-year yield sat at 4.232%, EURUSD traded in a 1.1629-1.1660 band and is pressing the top of the range. Gains are capped by political turbulence in France where the government faces a looming no-confidence vote over its austerity budget. Sentiment was further tempered by weaker-than-expected services, sentiment, and industrial confidence readings, though consumer confidence was steady. GBPUSD moved higher in a 1.3484-1.3519 range as the broadly softer US dollar provided support, along with lingering expectations the Bank of England will slow its pace of rate cuts. Technicals lean bullish while above 1.3420 with traders eyeing a break of 1.3540 to end the May downtrend and target 1.3690. USDJPY traded narrowly between 147.00 and 147.49 in a subdued session. Selling pressure followed slightly hawkish remarks from BoJ Board member Junko Nakagawa and broader US dollar weakness. Adding to the caution, Japan’s trade negotiator Ryosei Akazawa abruptly cancelled a US trip, citing the need for greater clarity around Japan’s planned $550 billion investment. AUDUSD climbed within a 0.6503-0.6524 range, benefiting from general US dollar softness and support from the PBoC’s latest measures that allowed the Chinese yuan to firm. Today’s US data includes weekly jobless claims, Q2 GDP, housing starts and Q2 Personal Consumption Expenditures Prices.