Canadian Dollar Update, July 9, 2020 – Canadian Dollar unphased by massive Federal Budget deficit
USD/CAD Open: 1.3510-11, Overnight Range: 1.3490-1.3558
WTI Oil is at $39.96 and gold is at $1,821.30. US markets are lower today.
For today, USD resistance is at 1.3542. Support is at 1.3479.
• Canada budget deficit soars to $343.2 billion
• Global stock markets ignore news of COVID-19 resurgence in USA
• US dollar falls across the board ahead of weekly jobless claims data
The Canadian dollar rallied, along with the rest of the G-10 majors, with rising stock prices feeding the move. China’s Shanghai Shenzhen 300 index soared over 16% since the beginning of the month. Traders reacted when officials suggested that fostering a “healthy bull market “ is important. China appears to have beaten the coronavirus into the ground, and its economy is rebounding. China June inflation rose 2.5%, compared to 2.4% in May while the Producer Price index improved to -3% from -3.7%.
The China stock market rally propelled Asia indexes higher, but European bourses were not as enthusiastic. The UK FTSE 100 is lower while the German DAX and French CAC are a tad higher. US futures are mixed, suggesting a cautious open on Wall Street.
FX traders are hoping that today’s US weekly jobless claims reports provide additional evidence that the economy is recovering from the impact of the restrictions imposed to combat the coronavirus pandemic. Initial jobless claims are expected to decline to 1.375 million this week, compared to last week’s 1.427 million result.
Canada’s finances are a mess. The government is unable to publish a budget due to a lack of clarity on expenditures and the outlook for the economy. Canadian dollar traders ignored the news and continued to buy the currency alongside widespread US dollar selling against the majors.
Today’s Suggested Range USD/CAD: 1.3460 – 1.3560
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By KBFX | July 9, 2020 | Daily Update | 0 comments