FX Markets Brace for US Jobs Data, BoC Decision Ahead
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Currency desks are squarely focused on the upcoming US jobs report, a release capable of confirming or unwinding this week's dollar-led momentum sparked by hawkish Fed commentary.
The Bank of Canada's policy decision adds another layer of volatility risk, with the loonie particularly exposed given its close correlation to shifting interest rate differentials against the US.
Bond markets are already adjusting ahead of these catalysts, and FX volatility is likely to stay elevated as traders weigh incoming data against the recent hawkish repricing in dollar rate expectations.