Euro gains against Canadian Dollar on upbeat German IFO Business Index

EUR/CAD appreciates following stronger-than-expected German IFO sentiment data across all major indexes in September.
Canadian Dollar resilience and uncertain oil markets may limit further upside for the EUR/CAD cross.
Iran threatens to restrict Strait of Hormuz navigation amid ongoing U.S. sanctions, bolstering energy prices.

Akhtar Faruqui FXStreet

EUR/CAD gains ground after registering modest losses the previous day, trading around 1.6060 during European hours on Thursday. The Euro (EUR) is appreciating as markets react positively to better-than-expected economic sentiment data out of Germany.

Germany’s IFO - Business Climate Index for September rose faster than anticipated, climbing to 89.9 from August's reading of 88.8 and beating consensus forecasts of 89.0. Broader metrics followed the same upward trend: the Current Assessment Index reached 89.5, topping expectations of 89.0 and the prior 88.5 reading, while the Expectations Index, a key gauge for six-month outlooks, accelerated to 90.4 against an 89.3 consensus.

Despite the strength of the Euro, upside potential for the EUR/CAD currency pair may be limited as the commodity-linked Canadian Dollar (CAD) holds firm. CAD continues to find support amid cautious market sentiment and geopolitical tension driving crude oil prices. The ongoing uncertainty surrounding diplomatic talks between the United States and Iran remains a primary driver of stability for energy markets.

Iranian President Masoud Pezeshkian delivered a defiant address at the UN General Assembly. Pezeshkian declared that Tehran would not yield to external threats, insisting on Iran's right to pursue nuclear technology for economic development. He further emphasized that Iran would restrict freedom of navigation through the critical Strait of Hormuz for as long as US sanctions and maritime blockades remain enforced.

US diesel export ban debate keeps energy policy risk elevated

Analysts at Rabobank highlight growing uncertainty around US energy policy, noting that “US Energy Secretary Wright has stated a US diesel export ban won't work,” yet, according to reporting from Politico, “the White House is still preparing [a] plan for [a] 90-day ban.” The bank suggests this policy disconnect is adding to market nervousness around diesel supply and pricing, particularly for import-dependent regions.

Economic Indicator

IFO – Business Climate

This German business sentiment index released by the CESifo Group is closely watched as an early indicator of current conditions and business expectations in Germany. The Institute surveys more than 7,000 enterprises on their assessment of the business situation and their short-term planning. The positive economic growth anticipates bullish movements for the EUR, while a low reading is seen as negative (or bearish).

AUD/USD turns lower toward 0.7000 after mixed Australian jobs data

AUD/USD is losing ground toward 0.7000 in the Asian session on Thursday, following the release of the Australian August jobs report, which showed that the Unemployment Rate rose to 4.6% versus 4.5% expected, while Employment Change beat estimates, arriving at 39.5K. Traders also remain unnerved ahead of the critical Trump-Xi meeting.

USD/JPY keeps the red near 158.00 as Japanese Yen firms up

USD/JPY retreats from three-week highs and holds losses near 158.00 in the Asian session on Thursday. Surging Japanese bond yields lift the Yen amid looming intervention risks, while the US Dollar preserves overnight gains to a two-month high amid hawkish Fed bets and elevated US bond yields.

Gold struggles near one-week low as traders await Trump-Xi meeting amid Fed hike bets

Gold sticks to a negative bias for the second straight day, trading below the $4,300 mark or a one-week low during the first half of the European session as traders await a crucial meeting between US President Donald Trump and his Chinese counterpart Xi Jinping. Expectations for a major announcement are low, though market players will look for any progress on rare earths, technology restrictions, and an extension of the current US-China truce.

Bitcoin slips to $84,000 on rate hike bets – Worldcoin, Pepe lead losses

Bitcoin (BTC) price trades below $84,000 on Thursday, extending losses after a 2% decline the previous day. The pullback aligns with renewed inflation and rate-hike concerns, as US composite and services PMIs rose to 58.4 and 58.7 in September. Worldcoin (WLD) and Pepe (PEPE) recorded double-digit losses over the last 24 hours, emerging as the worst performers.

SNB leaves interest rates unchanged at 0%

Swiss National Bank leaves its key policy rates unchanged at 0%, as expected by market particiapnts. The key highlights of SNB’s monetary policy assessment are as followed: Banks' sight deposits held at the SNB will be remunerated at the SNB policy rate up to a certain threshold. SNB sees 2026 inflation at 0.7% (previous forecast was for 0.6%). The main risk to the economic outlook for Switzerland stems from developments in the global economy.

BoJ Recap: Not as hawkish as expected

The Bank of Japan (BoJ) raised its short-term interest-rate target to 1.25% from 1.00% in a 7-2 vote, marking another step in the normalisation of monetary policy and widely matching what everyone has been expecting for weeks.