News image

Canadian Dollar Update, May 14, 2020 – Canadian Dollar under stress

USD/CAD Open: 1.4070-73, Overnight Range: 1.4068-1.4140

WTI Oil is at $26.09 and gold is at $1,739.60. US markets are lower today.

For today, USD resistance is at 1.4185. Support is at 1.4065.

The Canadian dollar is under stress. So are all the major G-10 currencies, except for the Japanese yen, after Fed Chair Jerome Powell reiterated the Fed would not cut interest rates to negative. Yesterday, Mr. Powell delivered a speech titled “Current Economic Issues.” He said the US government spent $2.9 trillion, which is about 14% of GDP, and pointed out that it was the “fastest and largest response to any postwar downturn.” He reiterated the Fed’s monetary policy response, and then reminded people that “the Fed has lending powers, not spending powers.” He added that to the economic recovery gain momentum, “additional fiscal support” would be worth it.”

Wall Street appeared to take the news that negative rates was not on the agenda rather badly. They sold stocks, and by the end of the day, the Dow Jones Industrial Average (DJIA) lost 516 points, while the S&P 500 index shed 1.75%. Asia and European equity indexes followed the US lead. Japan’s Nikkei 225 dropped 1.74% while European bourses are deep in the red, led by the UK FTSE, which has lost 2.82%, as of 8:00 am EDT.

Don't Waste Money With Banks.
Get Exchange Rates Up to 2% Better With KnightsbridgeFX

Get An Exchange Quote Now

EURUSD is consolidating overnight losses just above its session low. Prices are weighed down by safe-haven demand for US dollars, and additional weak German economic data.

USDJPY sank due to safe-haven demand for JPY and because of falling US Treasury yields. Bank of Japan Governor Kuroda said because of the pandemic; it would take some time for inflation to reach the 2.0% BoJ target.

AUDUSD and NZDUSD fell due to the shift into negative risk sentiment. Weaker than expected Australian employment data added to the AUDUSD selling pressure.

Oil prices extended yesterday’s rally. The news got better overnight when the International Energy Agency (IEA) released its Monthly Oil Market Report. They noted that “Global oil supply is set to fall by a spectacular 12 mb/d in May to a nine-year low of 88 mb/d, as the OPEC+ agreement takes effect and production declines elsewhere.”

The Canadian dollar sank but was still the best performing major G-10 currency overnight. USDCAD climbed from 1.4070 to 1.4014, however, a surge in West Texas Intermediate (WTI) oil prices acted as a drag on USDCAD gains.

The 2.9 million increase in US weekly jobless claims was a tad worse than forecast.

Today’s Suggested Range USD/CAD: 1.4020– 1.4120

Get Started With Knightsbridge Foreign Exchange

1

Get Your Free Quote

2

Book Foreign Exchange Rate

3

Send Funds

2

3

Step 1 : Get Your Free Quote

You completed 0% of your profile.

First Name *

Last Name *

Address *

City *

Province *

Postal Code *

Phone *

Email *

Occupation *

Date of Birth *

Please provide the reason for buying or selling the currency: *

(Travel, Bills to Pay, Purchase or Sale of Investment, etc.)

Please explain how you first obtain the source of funds being sold: *

(such as: Work Income, Sale of Investment, Gift, Inheritance, etc)

Are you or any close relative a Politically Exposed Foreign Person? *

(Head of State, Member of Senate, House of Commons, or Legistrature, etc)

Yes

No

I confirm I am not transacting on behalf of a third party and I have read and I agree to the Terms and Conditions

By KBFX | May 14, 2020 | Daily Update | 0 comments