USDCAD started the day with a bid and its sights set on 1.2770. Soft economic reports indicating that the domestic economy is slowing and rising expectations for a dovish Bank of Canada policy statement on Wednesday have underpinned the greenback.
However, the Canadian dollar may benefit from a dose of fiscal stimulus from today’s Finance Department Fall Update. The Finance Minister may have more cash to spend than he previously thought. (Perhaps, he found a government-owned villa somewhere, that he had forgotten about)
Overnight, NZDUSD got spanked. The new Labor government talked of reviewing the Reserve Bank Act and making changes to the Transpacific Trade Partnership. NZDUSD dropped from 0.7002 to 0.6921
AUDUSD found its rally terminated just before Europe opened. AUDUSD fell to 0.7775 from 0.7823.
USDJPY reversed yesterday’s late afternoon slide, in part because of Prime Minister Abe’s election win, keeps “Abenomics” alive.
It was PMI day in the Eurozone. Manufacturing PMI data for Germany, France and the Eurozone beat forecasts and supported EURUSD. The single currency.climbed from 1.1743 to 1.1769.
Sterling continues to trade off of Brexit headlines and interest rate expectations.
Oil prices were steady in Europe and Asia. WTI jumped from $51.57 to $52.33 in New York. Prices are supported by the perception of supply disruption risks, and falling US inventories
USDCAD Technical outlook:
The intraday USDCAD technicals are bullish while prices are above 1.2550 supported by the break above 1.2990 and are looking for a break above 1.2670 to extend gains to 1.2770. For today, USDCAD support is at 1.2610 and 1.2550. Resistance is at 1.2670 and 1.2740.
Today’s Range 1.2620-1.2690
Chart: USDCAD 1 hour