Canadian Dollar Update January 14, 2020 – Canadian Dollar bulls are suffering
USD/CAD Open: 1.3056-1.3057, Overnight Range: 1.3049-1.3079
Oil is at $58.20 and gold is at $1,544.50. US markets are mixed today.
The short-term USD/CAD technicals are neutral-bearish. For today, USD resistance is at 1.3087. Support is at 1.3048.
Canadian dollar bulls are suffering. The sharp reversal in oil prices from their recent peak and positive US sentiment around the US/China Phase 1 trade deal has fueled widespread US dollar demand against the G-10 major currencies and the Canadian dollar is collateral damage.
Those losses are occurring despite improving domestic data and comments from Bank of Canada officials indicating an extended period of unchanged interest rates. Yesterday’s Bank of Canada Business Outlook Survey showed business sentiment ticked higher in the fourth quarter. The indicator rose to its best level in a year, due in part to the improved US and China trade dialogue. However, it wasn’t all peaches and cream. Sentiment around future business investment dipped. Nevertheless, the Survey results suggest that the Bank of Canada will leave interest rates unchanged at the January 22nd monetary policy meeting.
China was the big story in Asia overnight. Chinese data, speculation around US/China Phase 1 trade deal details, and an announcement from the US Department of the Treasury hogged the limelight. Treasury Secretary, Steven Mnuchin, waited until just before the close of business yesterday to confirm earlier rumours that China was removed from the US Currency Manipulators list. He also said “The Treasury Department has helped secure a significant Phase One agreement with China that will lead to greater economic growth and opportunity for American workers and businesses,” adding “China has made enforceable commitments to refrain from competitive devaluation, while promoting transparency and accountability.”
Today, US December headline and core CPI rose 2.3%, as expected.
Today’s Suggested Range USD/CAD: 1.3010 – 1.3110
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By KBFX | January 14, 2020 | Daily Update | 0 comments