he U.S. dollar is mixed heading into a North American session with two central-bank decisions and major technology earnings on the calendar. The Bank of Canada announces its decision this morning, followed by the Federal Reserve this afternoon. After the closing bell, Microsoft and Alphabet will provide the next important test for technology shares and the AI investment story.
Treasury yields are higher, with the U.S. 10-year yield above 5%. Stock futures are mixed: the Dow is lower, while the S&P 500 and Nasdaq 100 point to modest gains. Oil is higher, while gold and silver are trading lower.
Overnight, the biggest currency move came from New Zealand. The RBNZ unexpectedly held its official cash rate at 2.75%, with the committee divided in a 4–3 vote. Governor Anna Breman subsequently indicated that additional increases remain likely, but the decision disappointed markets positioned for an immediate hike. Meanwhile, stronger Australian underlying inflation and hawkish comments from RBA Governor Michele Bullock reinforced expectations for further tightening. Those contrasting developments helped lift the Australian dollar and pressure the kiwi. See investingLive’s Asia-Pacific market wrap.
The Australian dollar leads; the New Zealand dollar lags
The Australian dollar is the strongest of the major currencies in the morning snapshot, while the New Zealand dollar is the weakest. From the U.S. dollar’s perspective, the greenback is higher against the kiwi, sterling and Swiss franc, but lower against the Australian dollar, Canadian dollar, euro and Japanese yen.
NZDUSD is down 1.27% at 0.5608, making it the clear outlier. By comparison, AUDUSD is up 0.14% at 0.7034, while USDCAD is down approximately 0.10% at 1.4034. EURUSD is up 0.07% at 1.1130, and USDJPY is down 0.03% at 157.89. GBPUSD is lower by 0.12% at 1.3287, while USDCHF is up 0.04% at 0.8293.
The broader dollar picture is therefore mixed. The sharp kiwi decline reflects a specific policy surprise, while the moves elsewhere remain relatively modest ahead of the North American events.
Currency ranges remain contained outside NZDUSD
The session highs and lows and the supplied average ranges:
-
EURUSD: 1.1114 to 1.1132 — 18 pips, approximately 28% of its 65-pip average.
-
USDJPY: 157.66 to 158.04 — 38 pips, approximately 45% of its 84-pip average.
-
GBPUSD: 1.3273 to 1.3312 — 39 pips, approximately 55% of its 71-pip average.
-
USDCHF: 0.8284 to 0.8313 — 29 pips, approximately 57% of its 51-pip average.
-
USDCAD: 1.4034 to 1.4068 — 34 pips, approximately 54% of its 63-pip average.
-
AUDUSD: 0.7024 to 0.7054 — 30 pips, approximately 65% of its 46-pip average.
-
NZDUSD: 0.5585 to 0.5689 — 104 pips, approximately 231% of its 45-pip average.
EURUSD has the most room to roam relative to its normal daily activity. USDJPY is also relatively confined, having completed less than half its average range. That leaves scope for an extension if the central-bank news produces a sustained technical break.
NZDUSD has already exceeded twice its average range. That does not rule out additional movement, but traders should recognize that a substantial repricing has already occurred. Average ranges provide context; they do not establish a ceiling or guarantee that a quieter pair must move farther.
U.S. stock futures are mixed
-
Dow industrial average futures: down 105 points.
-
S&P 500 futures: up 9.5 points.
-
Nasdaq 100 futures: up 103 points.
The opening indications show a modestly firmer tone in the S&P and Nasdaq, although the Dow is lagging. The important question is whether those gains hold and broaden once regular trading begins, with the Fed announcement and earnings still ahead.
Treasury yields move higher
The 2-year Treasury yield is 4.7577%, up 2.07 basis points, while the 5-year yield is 4.8675%, up 2.55 basis points. The 10-year yield is 5.0155%, up 2.25 basis points, and the 30-year yield is 5.3125%, up 0.75 basis point.
The larger increases are in the shorter and intermediate maturities. I will be watching whether those gains extend or reverse after the Fed. A dollar break accompanied by a sustained move in yields would provide more evidence of a broader repricing in policy expectations.
European yields are also higher. Germany’s 10-year yield is 3.365%, France’s is 4.953%, and the UK’s is 5.354%. Italy’s 10-year yield is up 3 basis points at 4.532%.
European stocks are mostly lower
-
Germany’s DAX: up 0.04%.
-
France’s CAC 40: down 0.12%.
-
UK’s FTSE 100: down 0.25%.
-
Spain’s IBEX 35: down approximately 1.37%.
-
Italy’s FTSE MIB: down 0.01%.
Spain is the weakest of the supplied European benchmarks, while the German and Italian indices are little changed.
Oil rises; gold and silver retreat
U.S. crude oil is trading at $101.69, up $1.48, or 1.48%. Gold is lower by approximately $14.54 at $4,045.79, while silver is down 1.22% at $53.7421. Bitcoin is modestly higher at $81,097, up $286, or 0.35%.
Firmer oil keeps energy prices in focus ahead of the Fed’s inflation assessment. Gold is trading lower alongside higher Treasury yields, although the mixed dollar performance suggests caution in attributing its move to a single factor.
FOMC preview: A hold is expected, but the message matters
In his FOMC preview, “A hawkish hold as markets watch for signals about timing and extent of further tightening,” investingLive’s Giuseppe Dellamotta outlines a base case of unchanged rates at 3.75%–4.00%. His October 27 preview cited approximately 90% market pricing for a hold and an 80% probability of a December hike.
With no new economic projections or dot plot expected, attention shifts to the statement and Fed Chair Kevin Warsh’s press conference. The key issue is how strongly the Fed reinforces the need for additional tightening. A more forceful inflation message could pressure risk assets, while a more neutral tone could allow a relief rally.
For traders, an expected decision can still produce an unexpected reaction. The market responds to the difference between the message delivered and the message already priced in. I will be watching whether an initial break can hold beyond a key technical level. A failed break would tell a different story from a move that establishes acceptance above resistance or below support.
Bank of Canada and the North American calendar
The Bank of Canada provides the first major policy catalyst, with its rate announcement and Monetary Policy Report due at 9:45 a.m. ET. Governor Tiff Macklem and Senior Deputy Governor Carolyn Rogers follow with a press conference at 10:30 a.m. ET. The updated outlook and guidance will be important for USDCAD before attention shifts to the Fed.
The main scheduled events, in chronological order, are:
-
8:30 a.m. ET: U.S. advance goods trade balance, advance wholesale inventories and retail inventories excluding autos.
-
9:45 a.m. ET: Bank of Canada rate decision and Monetary Policy Report.
-
10:30 a.m. ET: Bank of Canada press conference.
-
2:00 p.m. ET: Federal Reserve policy decision.
-
2:30 p.m. ET: Fed Chair Kevin Warsh’s press conference.
The trade and inventory figures provide information on the contributions to economic growth, but the two central-bank decisions are the main scheduled policy events.
After the close: Microsoft and Alphabet headline earnings
The session’s event risk continues after the closing bell, with Microsoft and Alphabet the main earnings reports to watch. As Adam Button discusses in “Earnings macro week ahead: The Fed and Big Tech report on the same day,” their spending plans have implications beyond individual share prices. AI investment is an important part of the broader economic picture, making guidance on future spending especially relevant. Chipotle also reports after the close, providing another perspective on consumer demand.
For Microsoft, I will be watching Azure growth, AI-related revenue and the capital-spending outlook. The question is whether growth and profitability provide sufficient support for the investment being made. A headline earnings beat may not settle that question if guidance raises concerns about costs or the timing of returns.
For Alphabet, the focus includes Google Cloud, search advertising, AI monetization and spending plans. Advertising provides a useful read on business demand, while cloud performance helps assess whether the AI investment cycle continues to generate revenue growth.
Chipotle offers a different economic signal. Customer traffic, comparable sales and management’s pricing commentary should help distinguish changes in underlying demand from growth driven by higher menu prices.
The practical takeaway is that the afternoon reaction to the Fed may face another test after the close. Policy expectations will drive the first assessment; company results and guidance will then provide fresh evidence on demand, investment and profitability.
In the morning video above, I take a look at the three major currency pairs—EURUSD, USDJPY and GBPUSD—from a technical perspective. For each pair, I outline the bias, the risk-defining levels and the targets that would give either the buyers or sellers more control.
This article was written by Greg Michalowski at investinglive.com.