- Crude oil drops to seven-week lows on Wednesday ahead of EIA data.
- US Dollar Index continues to float above 97.50.
- Coming up: Ivey PMI data from Canada and speech by Chicago Fed’s Evans.
The USD/CAD pair rose sharply on Tuesday and preserved its momentum today to reach its highest level since June 19 at 1.3316. With the market action turning subdues ahead of the American session, the pair is moving sideways near 1.33 handle, adding 0.15% on the day.
Crude oil selloff hurts CAD
Concerns over the US-China trade war weighing on the global oil demand weighed on crude oil prices and dragged the barrel of West Texas Intermediate to a seven-week low of $53.14 today to keep the selling pressure on the commodity-sensitive Loonie intact. In its monthly report on Tuesday, the Energy Information Administration (EIA) announced that it lowered 2019 world oil demand growth by 70,000 barrels per day to 1 million barrels per day. At the moment, the barrel of WTI is down 0.4% on the day at $53.22 and is waiting for the EIA’s weekly stock report.
On the other hand, the US Dollar Index is clinging to modest daily gains above mid-97s today, helping the pair stay in the positive territory. Later in the day, Chicago Fed President Evans will deliver a speech and the Federal Reserve will publish the Consumer Credit report.
Although the Ivey Purchasing Managers Index from Canada will be featured in the economic docket, crude oil prices are likely to continue to impact the CAD’s market valuation. Markets expect the Ivey PMI to improve to 53 in July from 52.4 in June.
Technical levels to consider
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