Canadian Dollar Currency Exchange Update August 26, 2015
USD/CAD Open: 1.3265-1.3266 Overnight Range: 1.3250-1.3350
The Canadian dollar was rangebound in overnight currency exchange markets. Oil is at $39.69 and gold is at $1,124. US futures are higher. Today, the EIA releases oil inventories.
The short term Canadian dollar technicals are neutral. For today, USD resistance is at 1.3376. Support is at 1.3166.
The Canadian dollar has been erratic of late, as oil prices remain volatile and the global economic growth outlook becomes increasing convoluted. Equity markets are higher in premarket trading, but that was also the case in yesterday’s premarket before they closed lower, extending their decline to 6 straight days.
As September approaches, there is still much debate as to whether the Fed will decide to hike rates. Fed officials have started to back off their hawkish stance from the beginning of the month, as they will be trying to ascertain the impact the strong US dollar and perceived global economic weakness will have on inflation. With the US job market looking strong, inflation outlook will be the Fed’s primary consideration when assessing if/when to hike rates.
In the short-term, the Canadian dollar will continue to track oil prices closely, with relative policy playing a more prominent role as the September central bank meetings approach.
The Canadian dollar seems to lack catalysts in the short term. A weak domestic economy, falling oil prices, and potential issues in China do not bode well for the loonie. A longer term uptrend in the Canadian dollar relies on a strengthening Canadian economy, but this could take some time to come to fruition.
Today’s Suggested Range USD/CAD: 1.3250 – 1.3350
Rahim Madhavji | Knightsbridge Foreign Exchange | Toll-Free: 1-877-355-5239
Knightsbridge Foreign Exchange has based the opinions expressed herein on information generally available to the public. Knightsbridge Foreign Exchange makes no warranty concerning the accuracy of this information and specifically disclaims any liability for trading decisions based on the opinions expressed and information contained herein. Such information and opinions are for general information only and are not intended to present advice with respect to matters reviewed and commented upon.
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By Admin | August 26, 2015 | Daily Update | 0 comments