- USD/CAD is currently trading at 1.3317, within a range of between 1.3313 and 1.3370.
- USD/CASD has potentially “formed a top at 1.3467 in early March, and while this caps, targets 1.3114/1.3070 and below,” – analysts at Commerzbank argued.
USD/CAD has lost its footing above 50% of March’s range and attention has been diverted to the downside again. WTI is better bid at this juncture, lifting the Loonie amid positive sentiment surrounding progress that is being achieved within Sino and Us trade talks. At the same time, commodity demand is on the rise following Chinese factory data moving back into expansion territory – listing the mood throughout Global stock markets and benefiting commodity and risk-FX in general.
However, the Canadian GDP data was much better than expected last week and was the initial driver for the correction in the Loonie on Friday. Real gross domestic product expanded 0.3% in January, fully offsetting the declines in November and December 2018,” Statistics Canada reported on Friday.
Today, Minister of Finance, Bill Morneau, has been speaking about the 2019 Budget and the Government’s plan to invest in the middle class at an event hosted by the Canadian Association of New York.
So far, relevant to markets, he has said that he is hopeful that new NAFTA will be ratified by the U.S;
- Sees ‘rocky economy’ on oil slump before recovery in Q2 as expected.
- The housing market is more stable now than in previous years.
- Should lift tariffs on metals before USMCA deal is signed.
Coming up…
BoC gove. will be speaking later today at 18.55 GMT and will focus on The Importance of Trade in his last speech ahead of the April MPR.
“The BoC has repeatedly flagged trade tensions as a key risk and we suspect Poloz will tie these to recent economic weakness. Declarations that exports will help growth rebound from Q2 onward may give an optimistic tone but this will be taken sceptically by a market pricing in cuts,” analysts at TD Securities explained.
USD/CAD levels
As can be see within last week’s USD/CAD forecast, (USD/CAD Forecast: Bulls failed topside, focus is on 38.2%, trend support, then 200-DMA (1.3200)) the downside is indeed playing put and the price is hunting down the 38.2% Fibo while trading below the March trend line support.
USD/CASD has potentially “formed a top at 1.3467 in early March, and while this caps, targets 1.3114/1.3070 and below,” – analysts at Commerzbank argued.
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