Will USD/CAD Stay Firm Above 1.4000 Ahead of Key Data?
Upcoming Week Outlook: New Tariff Threats Prompt Significant Market Repricing
The US Dollar eased through most of the week as investors held onto optimism, but renewed trade war rhetoric from President Trump late in the week dented sentiment, giving the safe-haven USD renewed support ahead of the long weekend.
The US Dollar Index (DXY) may face a bearish reversal next week after failing to sustain its push above near-term consolidation highs. The DXY briefly breached 99.50 before retreating below 99.00, driven by fresh tariff threats targeting Chinese imports in response to China’s export restrictions on rare earth minerals.
US markets will be closed on Monday for Columbus Day, but trading resumes with ongoing concerns about tariffs and the government shutdown. Market participants will also focus on Fed Chair Jerome Powell’s remarks on Tuesday and Producer Price Index (PPI) data on Thursday.
EUR/USD is expected to remain subdued near 1.1600, with limited volatility likely despite the final German HICP inflation figures on Tuesday and ECB President Christine Lagarde’s speeches later in the week.
GBP/USD saw a modest rebound on Friday from the 200-day EMA, but its overall pattern of lower highs and lows restricts upside. Key events include UK labor and unemployment data on Tuesday and Bank of England Governor Andrew Bailey’s speech at the Group of Thirty seminar on Saturday.
XAU/USD capped a record-setting week above $4,000 per ounce, supported by political uncertainty in the US and persistent safe-haven demand.
WTI Crude Oil fell below $60 per barrel for the first time in five months as trade war fears and OPEC production cap adjustments combined to pressure global oil demand, highlighting ongoing risk aversion in energy markets.
Overall, next week is expected to feature cautious trading, with USD direction, tariff developments, and geopolitical tensions likely driving short-term market sentiment.