Canadian Dollar Update December 19, 2019 – Canadian Dollar inflates after inflation news
USD/CAD Open: 1.3114-1.3115, Overnight Range: 1.3108-1.3138
Oil is at $61.13 and gold is at $1,480.30. US markets are higher today.
The short-term USD/CAD technicals are neutral-bearish. For today, USD resistance is at 1.3168. Support is at 1.3087.
The Canadian dollar is trading on a firm note and back to levels last seen on October 30, 2019. A confluence of events occurred to underpin the currency and yesterday’s domestic inflation report was just the latest development.
Statistics Canada reported that Core CPI rose 2.2% in November. The result was exactly as forecast and as expected. It helps to validate their decision to leave interest rates unchanged while adopting a “wait and see” approach. The Canadian dollar got a bit of lift from the news on the belief that the inflation reading reduced the chances for a rate cut for the foreseeable future.
The Bank of Japan monetary policy meeting just ended with rates and policy left unchanged. BoJ Governor Kuroda warned of downside risks still existing which requires a monetary policy with an easing bias. The results were largely expected, and USDJPY trade continued to consolidate earlier gains from rising US Treasury yields.
The Australian dollar got a boost after the domestic employment report revealed a surge in jobs. Australia added 39,900 new jobs, but the details were a tad less rosy. 35,700 of those jobs were part-time. The New Zealand dollar tracked AUDUSD moves but stayed in a tight range.
The Bank of England left interest rates unchanged at 0.75% as expected. Once again, the vote wasn’t unanimous. Two officials voted for rate cuts. The dissenters were concerned about soft economic and slowing employment growth.
EURUSD dropped along with GBPUSD and is trading in Toronto at its overnight lows. The only news of note was that Sweden’s Riksbank ended their negative interest rate policy, increasing its benchmark repo rate to 0.0% from -0.1%.
The Canadian dollar will continue to track broad US dollar moves today and continue to garner a little support from oil prices.
Today’s Suggested Range USD/CAD: 1.3060 – 1.3160
Get Started With Knightsbridge Foreign Exchange
Book Foreign Exchange Rate
By KBFX | December 19, 2019 | Daily Update | 0 comments