Canadian Dollar Rallies on High Oil Prices and Mixed Macro Data

The  Canadian dollar today rallied higher against its US peer driven by  high crude oil prices before the release of multiple fundamental reports from the Canadian docket. The USD/CAD currency pair today fell as the loonie rallied higher against the much weaker greenback amid a risk-on market environment as investors remain hopeful about the future.
The  USD/CAD currency pair today fell from a  high of  1.3950 in  the  Asian session to  a  low of  1.3868 in  the  American session and  was trading near these lows at  the  time of  writing.
The  loonie’s rally was driven by  the  rallying crude oil prices as  tracked by  the  West Texas Intermediate, which hit a  high of  33.73 earlier today. The  recent recovery in  oil prices has been good for  the  commodity-linked loonie, which has rallied against most of  its peers. The  release of  Canada’s consumer price index data for  April had a  muted impact on  the  pair despite the  headline print missing analysts’ estimates. According   to  Statistics Canada,   the  country’s CPI contracted by  0.7% versus the  expected 0.6%, and  the  core print was also lower than expected. However, Canada’s wholesale sales fell less than expected cushioning the  pair from further declines.
The  loonie was also boosted by  the  robust measures taken by  the  Canadian government to  combat the  COVID-19 outbreak in  care homes. Several provinces have announced significant funding packages to  curb the  spread of  the  coronavirus as  the  country slowly reopens its economy.
The  currency pair’s future performance is likely to  be affected by  crude oil prices and  geopolitical events.
The  USD/CAD currency pair was trading at  1.3882 as  at  15:28 GMT having fallen from a  high of  1.3950. The  CAD/JPY currency pair was trading at  77.32 having risen from a  low of  77.15.
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