Canadian Dollar Update, May 5, 2020 – Canadian Dollar cooking with oil
USD/CAD Open: 1.4060-64, Overnight Range: 1.4007-1.4094
WTI Oil is at $24.14 and gold is at $1,708.80. US markets are higher today.
For today, USD resistance is at 1.4082. Support is at 1.3978.
• Surging oil prices lift Canadian dollar
• US dollar opens in Toronto on a mixed note
The Canadian dollar added to yesterday’s gains overnight, underpinned by a surge in crude oil prices.
West Texas Intermediate (WTI) oil prices have more than doubled since touching $10.08/b on April 28. The catalyst for the move was the onset of OPEC/Russia agreement to slash crude production by 10.0 million barrels per day, beginning May 1. Gasoline sales have started to increase with the reopening of previously locked-down Texas cities and in China. Optimistic crude price forecasts are also supporting prices. Goldman Sachs expects WTI prices to climb to $51.38/b in 2021 while UBS analysts suggest crude demand will outstrip supply by Q4 2020. The Canadian dollar was supported on the news.
Today’s US data includes ISM non-manufacturing PMI. The index is expected to drop to 36.8 in April compared to 52.5 in March. Canada trade data is also on tap.
Today’s Suggested Range USD/CAD: 1.4010– 1.4110
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