Canadian Dollar Rallies Against US Peer Driven by Dollar Dynamics

The  Canadian dollar today rallied against its US peer benefitting heavily from the  latter’s decline as  investors remained cautiously optimistic about the  global economy. The  USD/CAD currency pair fell as  the  loonie rallied driven by  the  upbeat investor sentiment as  Canada insists that it will not open its borders to  Americans given the  surge in  US coronavirus cases.
The  USD/CAD currency pair today fell from a  high of  1.3237 in  the  Asian session to  a  low of  1.3192 in  the  early American market mirroring the  action in  the  dollar index.
The  currency pair’s decline was mostly fueled by  the  dollar’s weakness as  tracked by  the  US Dollar Index, instead of  the  loonie’s strength. The  weak American crude oil prices as  tracked by  the  West Texas Intermediate could not have boosted the  commodity-linked loonie. The  release of  Canada’s weak manufacturing sales report for  August by  Statistica Canada also did not help the  pair, and  neither did the  Canadian portfolio investment figures. News that Canada was shutting its borders to Americans also did not favor the loonie given the importance of the US as a major trading partner to Canada.
The  release of  the  upbeat US retail sales data for  September by  the  Census Bureau gave the  currency pair some relief. The  retail sales rose 1.9% in  September versus consensus estimates of  0.7% growth.
The  currency pair’s performance over the  upcoming weekend is likely to  be influenced by  crude oil prices and  US dollar dynamics.
The  USD/CAD currency was trading at  1.3196 as  at  14:19 GMT having crashed from a  high of  1.3237. The  CAD/JPY currency pair was trading at  79.81, having risen from a  low of  79.47.
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