FED: Gov Bowman: No Urgent Need For More Hikes

• RES 4: 1.4175 High Jul 13
• RES 3: 1.4129 High Jul 28  
• RES 2: 1.4080 High Aug 4 and 5 
• RES 1: 1.3912/1.3952 High Aug 31 / 50-day EMA  
• PRICE: 1.3902 @ 16:54 BST Sep 01
• SUP 1: 1.3732 Low Aug 21 and the bear trigger
• SUP 2: 1.3715 76.4% retracement of the May 1 - Jun 24 bull cycle
• SUP 3: 1.3672 Low May 12
• SUP 4: 1.3620 Low May 7

A bear theme in USDCAD remains intact and recent gains are considered corrective. Recent fresh cycle lows confirmed an extension of the bear leg reinforcing current conditions. Key resistance to monitor is 1.3956, the 50-day EMA. A break of it would undermine the bear theme. Scope is seen for a deeper retracement of the May 1 - Jun 24 bull leg. 1.3817, 61.8% of the May 1 - Jun 24 downleg, has been breached. This opens 1.3715, the 76.4% level.   

• Treasuries extended lows late Tuesday as the US & Iran traded strikes yet again, oil surged nearly $5/bbl: WTI over $90.50 in late trade.
• Risk sentiment chilled midday Tuesday after Iran headlines reported blasts "across the southern regions" - followed shortly after by an Axios report that the US Air Force was hitting Iranian targets "around Hormuz". Treasury yields climbed (10Y +.0461 to 4.7961%) while crude prices surged (WTI near $90.5/bbl) on the news.
• Iranian news reported "IRAN BEGINS 'DECISIVE OPERATION' IN RESPONSE TO US STRIKES" TASNIM, while the "IRGC SAYS U.S. ATTACKS WILL 'TIGHTEN THE LOCK' ON THE STRAIT OF HORMUZ - STATEMENT" - Rtrs.
• Currently, TYZ6 trades -9 at 107-12 vs. -11.5 low, yield +.0441 at 4.7941% (new 19 year high), technical support below at 107-02.5 (1.236 proj of Jun 30 - Jul 14 - 17 price swing).
• On data: The ISM mfg index surprisingly eased to 54.6 (cons 55.2, 58 responses) in August after 55.6 in July, although bear in mind that the 54.6 is still the second strongest reading since May 2022. New orders offered one of the weaker sequential developments in August as they softened to 53.7 (cons 56.8, 7 responses) after 56.7 in July for the lowest since Mar 2026.
• JOLTS Job openings were slightly lower than expected in July at 7.27mn (sa, cons 7.31mn) for a modest increase from a more solidly downward revised 7.18mn (initial 7.36mn) in June. Quit rates disappointed though as the overall rate fell to 1.92 from 2.02 (initial 2.03) for joint lows since Oct 2025.
• Look Ahead: Japan and China S&P Global Final Services/Composite PMIs, the Bank of Canada makes their policy annc. US data includes August ADP, Factory/Durables/Cap Goods and Fed Beige Book.

• US Data/Speaker Calendar (prior, estimate). All times ET
• 09/02 0700 MBA Mortgage Applications (-1.0%, --)
• 09/02 0815 ADP Employment Change Aug (44, 47)
• 09/02 1000 Factory Orders (-0.3%, 0.7%), Ex Trans (-0.4%, 0.4%)
• 09/02 1000 Durable Goods Orders final (1.1%, 1.1%), Ex Trans (0.4%, 0.4%)
• 09/02 1000 Cap Goods Orders Nondef Ex Air final (0.2%, 0.2%), Ship (1.4%, 1.4%)
• 09/02 1130 US Tsy $72B 17W bill auction
• 09/02 1400 Fed Releases Beige Book
• Source: Bloomberg Finance L.P. / MNI