A Soft Dollar, A Hot Canadian Print, and Yields at a Generation High

The dollar's defensive posture

InvestingLive's session note framed the North American open plainly: the dollar started the week on the defensive 37. The description sits alongside a data mosaic that gave no single, unambiguous signal. Friday's retail sales figure was described as soft, with earnings season now cast as the next test of the consumer story 1.

Housing data added to the muddle. The NAHB housing market index for August came in at 35 against an expected 33, a tick higher, though coverage of the same release stressed that sentiment remains weak overall 35. By contrast, the Empire State manufacturing index surprised to the upside, registering 20.6 against a forecast of 11 2630, a gap wide enough to complicate any single narrative about the health of US activity. TD Securities' framing of the US economy — sideways growth and sticky inflation — was the headline offered for the broader backdrop 23.

Elsewhere in dollar-linked flows, USDCHF was reported shifting its short-term bias to the downside on a break of the 100- and 200-hour moving averages 7, and USDCAD was described testing its 200-day moving average and channel trendline, with buyers said to be trying to stall the fall 16. The New Zealand dollar was reported at a two-month high, with dollar weakness offsetting softer China data in that account 20.

Canada's inflation surprise

The day's most concrete release came from Canada. July headline CPI accelerated to 3.0% year-on-year against an expected 2.9% 222829, with the monthly figure in line with forecasts at 0.5% 31. Core measures also firmed: the BoC's core CPI year-on-year rose to 2.3% from 2.1% 32, and the core monthly reading rose to 0.2% from a prior 0.1% 3327.

The currency reaction was reported as a firming of the Canadian dollar against the US dollar following the hotter print 11, even as coverage noted the loonie struggling against the euro as inflation accelerated 12. Equities told a different story: Canada's TSX was reported down as the hotter-than-expected inflation data dampened investor enthusiasm 9. RBC's commentary, filed under the same news cycle, characterised Canadian inflation as steady near target 4, a framing that sits awkwardly beside the 3% headline figure and underscores how differently the same release can be read.

Portfolio flow data released alongside the inflation report showed Canadian investment in foreign securities rising to C$35.43bn in June from a prior C$22.27bn 24, while foreign investment in Canadian securities registered at C$40.83bn, well above an expected C$15bn 25. Separately, Unifor was reported saying Stellantis is weighing closure of its Brampton plant in Canada 38, a headline that touches the same currency zone without, on the dossier's evidence, any stated link to the inflation print.

The long end of the curve

US 30-year Treasury yields were reported rising to the highest level since 2007 19. The dossier does not attribute this move to a specific catalyst beyond its own occurrence, and no forecast is offered here as to its persistence. Read alongside TD Securities' sideways-growth, sticky-inflation framing 23 and the Empire Manufacturing beat 2630, the long-end move sits within a data environment that has not, on this evidence, produced a single coherent direction of travel for US rates expectations.

Currency crosscurrents and corporate notes

Away from the dollar and the loonie, sterling was described as pressing toward 1.3600 with an uptrend said to be strengthening 34, and the euro was reported carrying bullish momentum toward the mid-1.17s against the dollar, in Scotiabank's characterisation 2. The yen drew more circumspect coverage: BNY was cited attributing policy doubts as a weight on the currency 10, while Societe Generale's headline described the Bank of Japan's path as questioned amid weak demand 40. The Norwegian krone was flagged by Rabobank as seeing further gains against the euro 36.

SentryQ's own measurements show 21-day realised volatility clustered in a narrow band — 4.1% annualised for EURUSD, GBPUSD and AUDUSD, and a slightly higher 4.9% for USDCHF and USDCAD 4243454647 — figures that describe comparatively quiet recent conditions relative to the day's headline-grabbing moves in rates and inflation data.

In equities, the session was reported as a split one: the Dow falling while the Nasdaq rose, lifted by gains in memory chip names Micron and Sandisk 39. Single-stock notes included O-I Glass and RBA shares touching 52-week lows 813, alongside a 52-week low for Cornerstone Strategic Value Fund 14, while HF Sinclair was reported reaching an all-time high 15. Also filed in the day's flow: Scott Bessent was reported endorsing Warren Buffett's dictum against betting against America 21, and US prosecutors were reported focusing on four businesses tied to Mark Walter, per the Wall Street Journal 35 — items that sit adjacent to, rather than inside, the macro story.