Daily Market Breakfast from TMGM: 24 October 2026

WTI Hits Fresh High as Markets Assess Rate Outlook

• A 22-week high in WTI crude followed attacks targeting Saudi Arabia and ships leaving the Strait of Hormuz.
• For October, TD Securities economists expect the Federal Reserve to keep rates at 4.00%; their forecasts still include further tightening in December and March.
• Economic slack continued to favour waiting, RBC economists argued, despite Bank of Canada communications signalling a greater readiness to take pre-emptive action against inflation.
• October should bring no change to the ECB's 2.50% deposit rate, Commerzbank economists forecast, with an increase to 2.75% expected in December.
• Seven consecutive days of declines left USD/CAD below 1.4000, its weakest level in a month.
• Following Thursday's one-month low of 0.8191, USD/CHF regained 0.56% to stand near 0.8250.

Currencies Diverge as Oil Advances

USD/CAD Extends Losses While USD/CHF Recovers

Below 1.4000 on Friday, USD/CAD was at its weakest in a month after seven consecutive days of losses. Recovering US dollar and Treasury yields, however, enabled USD/CHF to recoup the previous day's decline with a 0.56% rise to around 0.8250. Its Thursday low of 0.8191 had marked the weakest level in a month.

Energy Prices Rise Amid & Geopolitical Tensions

Gulf Attacks Lift WTI to 22-Week High

The $95.00–$101.00 per barrel range that contained WTI crude from Monday through Thursday gave way to a rise to a 22-week high. Prices advanced after two days of Houthi attacks in Saudi Arabia and strikes on ships leaving the Strait of Hormuz.

Central Bank Forecasts Point to Further Tightening

Fed Set to Hold at 4.00% in October, TD Securities Forecasts

At the October FOMC meeting, the Federal Reserve is expected to maintain its policy rate at 4.00%, according to TD Securities strategists. This replaces their previous expectation of continued tightening, which they said had been supported by strong inflation and a labour market that remained in good shape.

December and March remain the expected dates for additional rate increases in the strategists' projections. These are forecasts by TD Securities, rather than a course of policy announced by the Federal Reserve.

Bank of Canada Shows Greater Readiness to Counter Inflation, RBC Says

A greater inclination to act pre-emptively against inflation risks was suggested by recent Bank of Canada communications, said Royal Bank of Canada economists Frances Donald and Nathan Janzen. In their view, evidence of a changed risk assessment came from the 2 September rate decision and Governor Tiff Macklem's remarks on the sidelines of the International Monetary Fund meetings.

There was still a compelling argument for waiting, the economists maintained. Improvement in Canada's economy had not yet translated into strength, while sufficient spare capacity remained to contain inflation pass-through. They regarded a 25-basis-point rise in October as possible, although the increase could alternatively come in December or January.

The timing of the increase would have no material bearing on RBC's medium-term economic outlook, the bank said. Conditional on gradual economic improvement, 100 basis points of rate increases in 2027 were already included in its baseline.

ECB to Hold in October Before December Rise, Commerzbank Forecasts

An October deposit rate of 2.50% remains Commerzbank economists' forecast for the European Central Bank. With eurozone inflation proving persistent, they expect an increase to 2.75% in December, followed by an unchanged rate for the whole of 2027.

For some ECB Governing Council members, the current rate of 2.50% was already slightly restrictive, the economists said. Policymakers' comments on the neutral interest rate led Commerzbank to conclude that a majority of the council would likewise consider a 2.75% deposit rate slightly restrictive. Its forecast of a subsequent pause reflected, among other factors, higher bond yields and the restrictive effect of policy rates.

Rate Decisions Lead the Event Calendar

• Federal Reserve to Announce Interest-Rate Decision — United States: The FOMC is scheduled to deliver its interest-rate decision next week.
• Bank of Canada to Announce Interest-Rate Decision — 2026-10-28: Canada: Wednesday will bring the scheduled announcement of the Bank of Canada's overnight-rate decision.
• European Central Bank to Announce Interest-Rate Decision — Eurozone: The ECB is scheduled to deliver its interest-rate decision next week.