The Canadian dollar is again trading at 8 month highs and up 0.2% this morning, in line with a declining US dollar index which is down 0.2%. As we begin the last week of the summer holiday season, the same themes that have dominated market sentiment for the last two months are in play. Optimism about the global economic recovery abounds. That optimism is largely tied to central bank actions overall, and more recently to the announced policy shift at the Fed on inflation, which will see rates stay “lower longer” for an extended period of time. The Bank of Canada will likely follow suit. Stock indices, which are already at record levels, are trading up slightly and oil is up over 1%. US/Trade China trade tensions continue to flare up periodically. This morning, news that China has instituted restrictions on AI exports that may harm the chances of the TikTok sale have aggravate trade tensions anew. In Canada, there are no major economic data points until Thursday and Friday when we get reports on trade and employment.
