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The Canadian dollar continues to drift but that could change with the release of Canadian and US inflation later today. In the North American session, USD/CAD is trading at 1.3687, down 0.13% on the day.

Canadian, US CPI expected to have accelerated in June

It promises to be an interesting day as both Canada and the US release the June inflation reports.

In Canada, headline CPI is expected to rise to 1.9% y/y from 1.7% in May, while the monthly rate is projected to ease to 0.1% from 0.6%. Two key core CPI indicators are expected to show an average of 3.0% y/y, unchanged from May.

In the US, the markets are also bracing for higher inflation. The consensus for headline CPI is 2.7% y/y, compared to 2.4% in May. Monthly, CPI is expected to rise to 0.3%, up from 0.1% in May. Core CPI is expected to rise to 3.0% y/y from 2.8% and monthly to 0.3% from 0.1%.

How will the Bank of Canada and the Federal Reserve view the inflation numbers? The BoC won't have any problem with a CPI of around 2%, which is the Bank's inflation target. Still, core CPI, which is a better gauge of long-term inflation than headline CPI, is uncomfortably high at 3%, and the BOC would like to see the core rate move lower before lowering interest rates.

Have the Trump tariffs boosted inflation?

In the US, if June inflation rises as is expected, fingers will quickly point at President Trump's tariffs as finally having an impact. Recent inflation reports have not shown a significant spike higher to the tariffs, which were first imposed in April. However, the tariffs may have needed time to filter throughout the economy and could be felt for the first time in the June inflation reading.

The Fed is widely expected to hold rates at the July 30 meeting, with the markets pricing in a 95% chance of a hold, according to CME's FedWatch. For September, the odds of a rate cut stand at 59%. Today's inflation report could cause a shift in these numbers.

USDCAD Technical

• USD/CAD is testing support at 1.3695. Next, 1.3680 is a weak support line, followed by 1.3656
• There is resistance at 1.3719 and 1.3734

USDCAD 1-Day Chart, July 15, 2025

Market Overview

The crypto market cap retreated 3.5% to $3.67 over 24h after Bitcoin’s sharp dive in the middle of the European session on Monday. Notably, stock indices continued to move upwards, confirming no radical change in risk appetite.

Bitcoin was one of the main victims of sharp profit-taking, falling 4% in 24 hours to $117K after setting a record at $123K. This is significantly higher than the last peak of $112K, so there is no point in talking about a reversal. At the same time, we are getting further confirmation of a change in the nature of the market with more frequent profit-taking. It is becoming the norm for very long-term buyers to join in the selling.

Ethereum also experienced a 5% pullback to $2930 from its latest peak but quickly returned to growth on Tuesday morning to $2980. Judging by its dynamics, crypto traders are bullish, assuming only a short-term pullback.

News Background

According to CoinShares, global investment inflows into crypto funds last week amounted to $3.717 billion, the second largest in recorded history. Investments in Bitcoin increased by $2.731 billion, Ethereum by $990 million, Solana by $93 million, and Sui by $4 million. The XRP token saw a record weekly outflow of $104 million.

Cryptocurrency ETFs saw inflows for the 13th consecutive week, increasing investments since the beginning of the year (YTD) to $22.7 billion. Assets under management (AuM) reached a new record of $211 billion. Bitcoin ETF AuM exceeded $179 billion, already accounting for 54% of gold ETF AuM, according to CoinShares.

Bitcoin’s market capitalisation reached $2.4 trillion. This figure exceeded the capitalisation of Amazon ($2.3 trillion) and silver ($2.2 trillion).

There are no signs of active coin selling on the market. According to CryptoQuant, crypto wallets that only buy Bitcoin have increased their activity by 71% over the past month.

The latest recalculation increased the difficulty of mining Bitcoin by 7.96% to 126.27 T. The indicator approached the historical maximum of 126.98 T recorded in May.

Market data indicates the start of the altcoin season, but according to Santiment, there are warning signs. CoinMarketCap’s alt season index is at 27, indicating that market participants still prefer Bitcoin.

Germany’s ZEW Economic Sentiment index jumped from 47.5 to 52.7 in July, beating expectations of 50.2 and marking the third consecutive monthly rise. Current Situation Index also improved sharply from -72 to -59.5, above forecast of -66.0. The data suggests that investor confidence is firming despite lingering global trade tensions, likely supported by hopes for a de-escalation in US-EU tariff threats and anticipated domestic fiscal stimulus.

Eurozone sentiment also edged up modestly, with the expectations index rising from 35.3 to 36.1, though falling short of the 37.8 consensus. The current conditions measure rose by 6.5 points to -24.2, signaling a gradual improvement in the broader bloc’s outlook.

ZEW President Achim Wambach noted that nearly two-thirds of respondents expect Germany’s economy to improve, citing optimism tied to a resolution of the US-EU trade standoff and government-led investment. Expectations were especially upbeat in sectors like machinery, metals, and electrical manufacturing.

Full German ZEW release here.

Eurozone industrial production jumped 1.7% mom in May, comfortably beating market expectations of 1.1% mom. The strength was broad-based across key sectors, with notable gains in energy (+3.7%), capital goods (+2.7%), and non-durable consumer goods (+8.5%). However, weakness in intermediate goods (-1.7%) and durable consumer goods (-1.9%) tempered the overall picture.

Across the broader EU, industrial production rose 1.5% mom. At the national level, Ireland led the surge with a sharp 12.4% mom rise, followed by Malta (+3.4%) and Germany (+2.2%). On the flip side, industrial activity contracted most in Croatia (-2.9%), Slovakia (-2.8%), and Belgium (-2.7%).

Full Eurozone industrial production release here.

US benchmark indices inched upward on Monday, 14 July, with the S&P 500 rising 0.1% and the Nasdaq 100 gaining 0.3%, as investors looked ahead to the release of June's US Consumer Price Index (CPI) data and key Q2 earnings reports from major financial institutions including JPMorgan, Citigroup, Wells Fargo, and BlackRock.

In the early Asian session today (9:00 a.m. SGT), the S&P 500 and Nasdaq 100 E-mini futures spiked 0.5%, pushing the US SPX 500 CFD Index and US Nasdaq 100 CFD Index toward key short-term resistance levels at 6,290 and 22,920, respectively.

Nvidia boosts market sentiment on AI chip news

The sudden rally in US stock index futures was largely driven by a positive update from AI leader Nvidia. In a blog post, Nvidia revealed it had received assurances from the US government allowing it to resume shipments of its lower-end H20 AI accelerator chips to China, reversing earlier concerns over billions of dollars in unsold inventory.

China’s economic data lifts regional stock market optimism

A wave of stronger-than-expected economic data (except for retail sales) from China supported positive sentiment in Asian markets. Key highlights from June include:

New home prices in 70 cities declined at a slower pace (-3.2% y/y vs. -3.5% y/y in May), marking the slowest drop since April 2024.

Q2 GDP rose 5.2% y/y (above consensus of 5.1%), slightly down from Q1’s 5.4%.

Industrial production surged 6.8% y/y (fastest since March), up from 5.8% in May and beating forecasts of 5.6%.

Retail sales slowed to 4.8% y/y, below expectations of 5.6%, marking the weakest growth since February.

Buoyed by China’s economic resilience, the Hang Seng Index extended its winning streak to a fourth session, gaining 1% intraday to test its 24,490 resistance level established since 25 June. Japan’s Nikkei 225 rebounded 0.6% intraday after a successful retest of its 20-day moving average (support near 39,390). Meanwhile, Singapore’s Straits Times Index broke above the psychological 4,100 level with a 0.4% gain, marking a seventh straight record-high session.

US dollar retreats, Gold reclaims key levels

The US dollar began to pull back in the Asian session after three days of strength, as markets potentially priced in a hotter-than-expected US core CPI print of 3% y/y for June (vs. 2.8% in May). The Swiss franc, New Zealand dollar, and euro led the rebound, each rising 0.1% to 0.2% against the greenback.

Gold (XAU/USD) benefited from the softer dollar, climbing 0.4% intraday. The yellow metal traded above its 20-day and 50-day moving averages and approached the key intermediate resistance at US$3,360, reinforcing its short-term bullish momentum.

Economic data releases

Fig 1: Key data for today’s Asia mid-session (Source: MarketPulse)

Chart of the day – EUR/USD minor corrective decline stalls at 20-day moving average, bullish reversal looms

Fig 2: EUR/USD minor trend as of 15 July 2025 (Source: TradingView)

The recent price actions and key technical elements of the EUR/USD suggest that the three-week period of minor corrective decline from the 1 July 2025 high may have ended, where the EUR/USD is likely in the process of forming a potential fresh bullish impulsive up move sequence within its ongoing medium-term uptrend phase.

The hourly RSI momentum indicator has flashed out a bullish divergence condition since it reached its oversold region last Thursday, 10 July, and now managed to stage a bullish breakout above the 50 level (see Fig 2).

Watch the 1.1630 key short-term pivotal support, and a clearance above 1.1710 (minor descending trendline that capped prior rebound since 3 July) increases the odds of the start of the bullish impulsive up move sequence for the next intermediate resistances to come in at 1.1770 and 1.1810/1.1825 in the first step.

On the flip side, failure to hold at 1.1630 invalidates the bullish reversal scenario for an extension of the minor corrective decline to expose the next immediate support at 1.1580 (the lower boundary of the medium-term ascending channel from 13 May 2025 swing low).

As of today, the GBP/USD chart indicates that the British pound has declined by more than 2% against the US dollar since the beginning of July. Notably, the pace of the decline accelerated on Friday and continued into Monday.

According to Reuters, the pound is under pressure due to market concerns over a potential economic slowdown amid an escalating trade war. Last week’s data confirmed a contraction in UK GDP, which could have far-reaching implications. In this context, criticism of the UK government’s failure to reduce public spending is becoming more pronounced.

What’s next for GBP/USD?

Technical Analysis of the GBP/USD Chart

From a bullish perspective, it is worth noting that the pair has fallen to a significant support level around 1.3425. This level previously acted as resistance in the spring, but after a breakout, it has now turned into support (as indicated by arrows on the chart). Additionally, the RSI indicator shows strong oversold conditions, which suggests a potential short-term rebound.

From a bearish standpoint, it is concerning that the sharp rally from point A to point B has been entirely erased by the July decline. This indicates that despite significant gains by the bulls, they failed to hold them—casting doubt on GBP/USD's ability to sustain growth in the medium term.

Ongoing pressure may lead to an attempt by bears to push GBP/USD below the June low at point A. However, it is also possible that bearish momentum will weaken thereafter, potentially leading to a recovery within the developing downward channel (marked in red).

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The price of gold remains stable at $3,354 per troy ounce this Tuesday, recovering some of the previous day’s losses. Market attention remains firmly fixed on US trade policy developments.

President Donald Trump has formally notified leaders from 25 countries of new tariffs, including a 30% levy on imports from the EU and Mexico, set to take effect on 1 August. Trump warned that nations responding with retaliatory measures could face even stricter US restrictions, though he left room for further negotiations before the tariffs are imposed.

Investors are now awaiting the release of the US Consumer Price Index (CPI) for July, which may offer fresh clues on the Federal Reserve’s next steps regarding interest rates.

While physical gold demand remains steady, central bank purchases continue to provide strong strategic support for prices. Meanwhile, the US dollar’s trajectory is having little immediate impact on gold’s movements.

Technical Analysis: XAU/USD

H4 Chart:

On the H4 chart, XAU/USD broke above the 3,340 level, hitting its local target of 3,373. Today, the market has seen a technical pullback to 3,340 (testing from above) before initiating a new upward wave towards 3,400. Once this wave concludes, we anticipate a corrective retracement to 3,340, followed by a potential further rise to 3,434. This scenario is supported by the MACD indicator, where the signal line remains above zero and pointing firmly upwards.

H1 Chart:

On the H1 chart, the correction to 3,340 has completed, and the next growth wave towards 3,400 is underway. Today, we expect an advance to 3,370, after which a brief consolidation phase may form. A breakout above this range would reinforce bullish momentum towards 3,400. The Stochastic oscillator aligns with this outlook, with its signal line above 50 and rising sharply towards 80.

Conclusion

Gold’s near-term trajectory hinges on trade policy shifts and US economic data, while technical indicators suggest further upside potential after consolidation.

Markets

The US 30-yr yield was a whisker away from touching the psychological 5% mark yesterday as Friday’s tariff-driven sell-off in US Treasuries slowed. Still the US yield curve showed some gentle bear steepening with daily yield changes ranging between +1.4 bps (2-yr) and +2.8 bps (30-yr). The jury is still out with June US CPI inflation numbers up for release today. It’s the first of three “Summer” prints ahead of the September FOMC meeting which Fed Chair Powell referred to as key in determining the impact of US tariffs on price levels (higher or lower) and the Fed’s reaction function (cutting sooner rather than later). Consensus expects both headline and core CPI to accelerate to 0.3% M/M (2.6% Y/Y & 2.9% Y/Y respectively). Energy and food prices are expected to contribute positively, but attention will center on the pace of goods price inflation (clothing, furniture, toys, cars,…) as more and more firms hinted at passing through costs to consumers after initially shielding them by running down inventories or lowering margins. From a market point of view, anything in line or below market consensus will be seen as evidence of a subdued impact from tariffs, tipping the balance on the US money market further in the direction of a September Fed rate cut (currently 60% discounted). It can pull the US 2-yr yield back from 3.9% currently to this month’s low around 3.75% and halt the modest comeback of the dollar we’ve witnessed over the past couple of trading sessions. An upward beat can start moving the market needle to a first rate cut in December (currently almost two discounted) and push the front end of the curve back towards 4%, giving the dollar some additional backing. We expect the impact at the long end of the (US) yield curve to be bigger in the second (upside) scenario than in the first one given the lingering trade war and the structural deterioration in public finances stemming from Trump’s big beautiful bill. Both the Japanese 10-yr and 30-yr yield this morning tested the YtD high at respectively 1.6% and 3.2%.

Apart from US inflation numbers, we keep an eye at Bank of England governor Bailey’s Mansion House Speech tonight after market close. Previous BoE governors used that annual occasion in the past to announce a change of course. Bailey recently warned about signs of slack in the economy and a weakening labour market and tied that in a weekend interview with potential action by the BoE (switching to larger rate cuts). UK Gilts yesterday outperformed, especially at the front end of the curve, pulling sterling down. EUR/GBP is close to recording 0.87+ levels for only the second session since end 2023. The YtD top at 0.8738 and is a first target.

News & Views

The Chinese economy grew by 1.1% Q/Q and 5.2% Y/Y in the second quarter, from 1.2% Q/Q and 5.4% Y/Y in Q1 and slightly beating consensus estimates. YTD growth was reported at 5.3% compared to the same period last year. The monthly data published for June indicated better than expected production growth at 6.8% Y/Y (6.3% YTD) suggesting a still solid supply-side performance. At the same time, retail sales growth was weaker than expected at 4.8% Y/Y (5% YTD). Fixed asset investment slowed to 2.8%Y/Y from 3.8%. Property investment was 11.2% lower than in the same month last year. The external sector contributed positively to growth as exports rose 7.2% YTD, while imports declined 2.7%. The surveyed jobless rate remained unchanged at 5%. The data confirm the ongoing discrepancy between a solid/decent production & export-driven growth and lagging domestic demand in a context of deflation. In this respect new home prices declined by 0.27% M/M and 3.69% Y/Y. As trade tensions are likely to put pressure on exports going forward, the data support the case for further (targeted) stimulus of domestic demand. The yuan eases slightly this morning (USD/CNY 7.175).

The Czech Finance Minister yesterday gave a first assessment on the potential impact of the 30% tariff on EU imports by the US on Czech growth. Such a scenario might reduce this year’s growth by 0.4% from August and by 1.1 ppts in 2026, bringing growth at respectively 1.6% and 1.3%. Finance Minister Stanjura admitted that exports to the US only account for less than 3% of total exports, but the Czech economy will also be hit indirectly as its economy delivers components and other goods to EU trading partners.

Daily Pivots: (S1) 1.1648; (P) 1.1673; (R1) 1.1691; More...

Intraday bias in EUR/USD remains neutral for the moment. Consolidations from 1.1829 could extend further. Downside should be 1.1630 resistance turned support to bring rebound. Firm break of 1.1829 will resume the rise from 1.0176 and target 61.8% projection of 1.0176 to 1.1572 from 1.1064 at 1.1927. However, sustained break of 1.1630 will bring deeper fall to 55 D EMA (now at 1.1481) instead.

In the bigger picture, rise from 0.9534 long term bottom could be correcting the multi-decade downtrend or the start of a long term up trend. In either case, further rise should be seen to 100% projection of 0.9534 to 1.1274 from 1.0176 at 1.1916. This will now remain the favored case as long as 1.1604 support holds.

Daily Pivots: (S1) 147.13; (P) 147.46; (R1) 148.05; More...

Intraday bias in USD/JPY remains neutral with focus on 148.01 resistance. Firm break there will indicate that consolidations pattern from 148.64 has completed. Further rise should then be seen to resume the rally from 139.87, to 61.8% retracement of 158.86 to 139.87 at 151.22.

In the bigger picture, price actions from 161.94 (2024 high) are seen as a corrective pattern to rise from 102.58 (2021 low). There is no clear sign that the pattern has completed yet. But still, strong support is expected from 38.2% retracement of 102.58 to 161.94 at 139.26 to bring rebound.