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Euro drops against Canadian Dollar amid wave of protests in Europe

October 19, 2026

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EUR/CAD opened at a bearish gap as violent cost-of-living protests swept across France.
Oil prices fell after US President Trump paused Russian fuel export sanctions, pressuring CAD.
Markets expect the Bank of Canada to hold interest rates steady at its October meeting.

EUR/CAD remains in negative territory after experiencing volatility, trading around 1.5800 during European hours on Monday. The currency cross opened at a bearish gap as the Euro (EUR) faces headwinds from widespread unrest in France.

Speaking in a televised national address on Sunday following one of the country’s most severe days of civil unrest in recent years, French President Emmanuel Macron condemned the “shocking” violence stemming from protests over the rising cost of living. France’s demonstrations were the largest among a broader wave of protests that also impacted Belgium, Italy, and Portugal.

Meanwhile, the EUR/CAD cross faces volatility as the commodity-linked Canadian Dollar (CAD) faces potential pressure from declining crude oil prices. Oil slipped following US President Donald Trump’s decision on Friday to sign an executive order pausing key sanctions and tariffs on Russia under the Graham Act, a move expected to boost Russian fuel exports. The temporary waiver pauses restrictions Trump had signed into law just last month amid Congressional pressure over Russia’s war in Ukraine, with Secretary of State Marco Rubio noting that the administration will take up to 60 days to evaluate the economic impact of the decision.

Despite the headwinds for crude, traders expect the Bank of Canada (BoC) to keep interest rates on hold at its upcoming October meeting, maintaining the pause it has observed throughout the year, before potentially considering a rate hike in December. With underlying inflation remaining close to the BoC’s 2% target and growing slack in the domestic labor market, market participants see little justification for an immediate interest rate increase.

Canada inflation seen steady as RBC looks for CPI to hold at 3%

Economists at Royal Bank of Canada expect Canadian inflation to remain stuck at the current plateau, projecting that the headline Consumer Price Index will “hold at 3% year-over-year in September for a third consecutive month.” This anticipated steady reading underscores their view that, while price pressures persist, overall inflation is no longer accelerating on a headline basis.