Report published August 17, 2026
Scotiabank Daily FX Update: USD Softens to June Lows Amid Fiscal Concerns and Easing Fed Expectations
Source and citation context
- Issuer
- Scotiabank
- Report date
- August 17, 2026
- Analysis as of
- Not stated in source
Authors / editors: Shaun Osborne, Eric Theoret
Finvaulta summarizes Scotiabank's analysis. Attribute opinions, forecasts, time-sensitive values, and chronology to the issuer and report date; do not treat this page as an independent verification or a current market-data source.
The US Dollar has dropped to early June lows as softening US economic data and fiscal debt concerns reduce Fed tightening expectations and steepen the yield curve. Majors including EUR, CAD, and GBP are advancing against the dollar amid narrowing yield differentials and resilient non-US economic surprises.
Key Takeaways
- 1.The USD continues to soften broadly, driving DXY to early June lows on weakening US economic surprise data, easing Fed tightening expectations, and US fiscal concerns.
- 2.USDCAD technicals are bearish following a break below 1.3899 support, opening downside risk toward 1.3817 and potentially the 1.35/1.37 range, aided by resilient Canadian data.
- 3.EURUSD is extending gains for a fourth consecutive week supported by narrowing US-Eurozone yield spreads (-136 bps 2Y spread) and European economic resilience.
Table of Contents
- Overview
- Economic Surprise Indices
- USD Softer on Fed Outlook, Fiscal Focus
- USDCAD (1.3859)
- USDCAD short-term technicals
- EURUSD (1.1595)
- EURUSD short-term technicals
- GBPUSD (1.3559)
- GBPUSD short-term technicals
- TODAY'S CALENDAR
Report data
Economic Surprise Indices
| Metric | Estimate | Context |
|---|---|---|
| Eurozone vs US 2Y Yield Spread | -136.0 bps | Smallest US yield advantage over Eurozone since May |
| Canada CPI Headline Forecast (MoM) | 0.4% | Consensus expected reading for July CPI NSA MoM |
| Canada CPI Headline Forecast (YoY) | 2.9% | Consensus expected reading driving minor uptick in Y/Y rate |
| US Empire Manufacturing Index | 11.0 index | Consensus forecast vs 15.6 previous |
| US NAHB Housing Market Index | 33.0 index | Consensus forecast vs 34 previous |
Reports in this series
Daily FX Update is shown in chronological order through this edition, published on August 17, 2026.
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Authors / Editors
Reported Data Context
- Eurozone vs US 2Y Yield Spread: -136.0 bps (Current / Aug 17, 2026)
- Canada CPI Headline Forecast (MoM): 0.4 % (Jul 2026) · Source: Scotiabank FICC Strategy / Consensus
- Canada CPI Headline Forecast (YoY): 2.9 % (Jul 2026) · Source: Scotiabank FICC Strategy / Consensus
- US Empire Manufacturing Index: 11.0 index (Aug 2026) · Source: Scotiabank FICC Strategy / Consensus
- US NAHB Housing Market Index: 33.0 index (Aug 2026) · Source: Scotiabank FICC Strategy / Consensus