Canadian Dollar Update August 13, 2015
USD/CAD Open: 1.3061-1.3062 Overnight Range: 1.2959-1.3064
The Canadian dollar was rangebound in overnight currency exchange markets. Oil is at $42.97 and gold is at $1,118. US futures are higher. Today, the US released retail sales figures for the month of July.
The short term Canadian dollar technicals are neutral. For today, USD resistance is at 1.3124. Support is at 1.2918.
The Canadian dollar is soft this morning, retracing yesterday’s modest gains. Risk surrounding further material devaluation of the yuan has moderated, lending to US dollar strength. The US released retail sales figures for July, which rose 0.6% against expectations of a 0.5% increase. June retail sales figures were additionally revised upwards. Strong retail sale figures are indicative of higher consumption, which is a positive sign that the economy will be able to achieve the Fed’s inflation target of 2%.
Amidst the recent yuan devaluation and its impact on global economic outlook coupled with dovish sentiment from a few Fed speakers this week, a Fed rate hike in September was looking less likely. Strong retails sale figures have brought some momentum back to the possibility of a September rate hike. In the short-term, oil prices and central bank sentiment will continue to drive the Canadian dollar. The market is especially sensitive to any events that might impact the timeline for a Fed rate hike, and this will continue to be a US dollar story as the Canadian dollar continues to lack a catalyst.
Today’s Suggested Range USD/CAD: 1.3000 – 1.3100
Sincerely,
Rahim Madhavji | Knightsbridge Foreign Exchange | Toll-Free: 1-877-355-5239
www.knightsbridgefx.com
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By Admin | August 13, 2015 | Daily Update |
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