Earlier, several central banks announced coordinated action to keep US dollars cheaper. The move has prompted a gain in risk appetite that is helping the Canadian dollar today on the Forex market.
Central banks in the US and Europe, as well as the Bank of Japan, decided to extend the policy of dollar swaps that contribute to some of the liquidity of the world’s money supply. As a result of the move, the US dollar is plunging. Demand for high beta currencies, including the Canadian dollar is rising.
Indeed, the loonie is surging today, heading back toward parity, supported by rallying equities and oil prices above $100 a barrel. The move galvanized stock markets around the world, sending European equities higher and creating a frenzy of goodwill on the US stock market that has the Dow up more than 400 points as noon Eastern approaches.
All of this combines to help the loonie, which is seeing one of its best performances against other majors in weeks. Indeed, the Canadian dollar is almost universal higher against other currencies, especially the greenback and the euro.
At 16:42 GMT, USD/CAD is lower, dropping to 1.0195 from the open at 1.0321. EUR/CAD is down to 1.3707 from the open at 1.3743. GBP/CAD is down to 1.6010 from the open at 1.6088. CAD/JPY is higher, rising to 76.03 from the open at 75.67.
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