Canadian Dollar Update November 7, 2019 – Canadian Dollar shrugs off trade news
USD/CAD Open: 1.3180-1.3181 Overnight Range: 1.3160-1.3197
Oil is at $57.15 and gold is at $1,483.40. US markets are higher today.
The short-term USD/CAD technicals are neutral-bearish. For today, USD resistance is at 1.3199. Support is at 1.3138.
The Canadian dollar ignored US/China trade news headlines, overnight. The rest of the FX majors did not. China Ministry of Commerce Spokesman Gao Feng said that both sides agreed to phase in the removal of trade tariffs, admitting that they were close to a Phase 1 deal. The news triggered a fresh round of “risk on” demand, boosting global stock prices, US equity futures, oil, and all the major G-10 currencies except for the Japanese yen. The Canadian dollar’s participation in the rally was limited.
EURUSD has bounced between 1.1055-1.1095 in the past 24 hours. A short-term negative bias lacks conviction without a confirming move below support in the 1.1050 zone. EURUSD is weighed down by weak German economic data. The European Union Commission didn’t help. They cut their 2019 and 2020 Eurozone growth forecasts again, predicting 2019 growth at 1.1% (previously 1.2%). European Commission Vice President Valdis Drombrovskis said: “we may face difficulties in the future: a period of great uncertainty related to trade conflicts, heightened geopolitical tensions, persistent weakness in the manufacturing sector and Brexit.”
The Bank of England (BoE) left UK interest rates unchanged at 0.75%, in a 7-2 vote. The result was universally expected. However, BoE Governor Mark Carney managed to knock GBPUSD lower when he said risks to UK growth were skewed to the downside. GBPUSD dropped from 1.2875 to 1.2807 during Carney’s press conference.
USDJPY dropped as US Treasury yields soared following the China/US trade developments. However, the losses were small and prices recovered in early Toronto trading.
AUDUSD got a twin boost from the trade news and a jump in Australia’s trade surplus. NZDUSD tracked AUDUSD higher.
The Canadian dollar continues to drift inside a narrow trading band. The dovish Bank of Canada outlook offsets support from firming oil prices. There isn’t any Canadian economic data available today, and the US data is second tier.
Today’s Suggested Range USD/CAD: 1.3130 – 1.3230
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By KBFX | November 7, 2019 | Daily Update | 0 comments