- WTI recovers above $54 on hopes extension to oil output cut.
- US Dollar Index clings to small daily gains.
- Coming up: Markit Manufacturing PMI from Canada and the U.S.
The USD/CAD pair came under a renewed selling pressure after climbing to a session high of 1.3525 and erased its daily gains as the commodity-related took advantage of the recovery seen in crude oil prices. As of writing, the pair was trading a couple of pips below 1.35, losing 0.15% on a daily basis.
Following last week’s heavy selloff, the barrel of West Texas Intermediate is posting gains on Monday boosted by hopes of the OPEC+ extending its oil output cut. Earlier in the session, Saudi Arabian Energy Minister Khalid Al-Falih said that he was confident of the OPEC+ agreeing on an extension beyond June at the next meeting. Although earlier in the day Al-Falih noted that the U.S.-China trade conflict was likely to weigh on the demand outlook, the WTI clings to more-than-1% daily gains at $54.10.
On the other hand, the greenback, which suffered losses against its major rivals on Friday following the soft inflation data and heightened expectations of the Fed making a dovish shift in its policy outlook, is now posting small gains on the day at 97.70, keeping the pair’s losses limited for the time being.
Later in the session, the IHS Markit will be releasing its Manufacturing PMI reports for both Canada and the United States. Markets will be watching for fresh headlines surrounding the trade war as well.
Technical levels to watch for
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