- Crude oil prices extend losses after weekly EIA stock report.
- US Dollar Index fails to stay in positive territory.
- Canadian Ivey PMI rises to 54.2 in July from 52.4.
After retreating to 1.33 handle earlier in the session, the USD/CAD pair gained traction as falling crude oil prices weighed on the commodity-sensitive Loonie. As of writing, the pair was up 0.4% on the day at 1.3331.
WTI slumps below $51 on Wednesday
On top of concerns over global oil demand outlook amid the US-China trade conflict, the weekly report published by the US Energy Information Administration (EIA) showed an increase of 2.4 million barrels in the US crude oil stocks to push crude oil prices lower. The barrel of West Texas Intermediate is now down 5% on the day, trading at $50.75.
Earlier in the day, the Ivey Purchasing Managers Index (PMI) came in at 54.2 in July following June’s 52.4 reading and bettered the market expectation of 53. Nevertheless, the positive impact of the data on the Loonie faded away quickly as investors shifted their focus to crude oil prices.
On the other hand, the sharp drop witnessed in the 10-year US Treasury bond yield is making it difficult for the Greenback to find demand, keeping the pair’s gains limited for the time being. As of writing, the US Dollar Index was down 0.22% on the day at 97.37. US President Trump today called upon the Federal Reserve to cut rates “bigger and faster” in a Twitter thread and ramped up the odds of multiple rate cuts in the remainder of the year.
Later in the session, the Federal Reserve’s Consumer Credit Change data will be looked upon for fresh impetus.
Technical levels to watch for
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