SEPT TAPER IS OUR BASE CASE—NONFARM THE RISK
● USD is relatively quiet leading into the NA long-weekend.
● Month‐end flows suggest selling of CAD & AUD; buying of USD & GBP.
● CAD flat leading into GDP; next week BoC—we expect CAD weakness.
● EUR flat—technicals are bearish as soft CPI gives room to ECB.
● GBP flat as housing data is strong complicating the BoE’s position.
● JPY flat as BoJ’s policies gain traction as CPI trends higher.
● AUD flat—risk is Sept 3 RBA (we expect no change) & Sept 7 election.
● FX forecast—broad USD rally into year‐end for EUR, CAD, GBP & JPY.
● Long weekend with Syria risk overhang could see position squaring.
Read the full report: FX Daily
Scotiabank