- Crude oil sell-off intensifies in last hour to weigh on CAD.
- US Dollar Index clings to daily gains above 98.50.
- Canadian PM Trudeau announces general election on October 21.
The USD/CAD pair gained traction in the last hour and rose to its highest level of the day at 1.3182 as the falling crude oil prices weighed on the commodity-sensitive Loonie. As of writing, the pair was up 0.2% on the day at 1.3175.
OPEC’s monthly report drags crude oil prices lower
Although the weekly data published by the Energy Information Administration (EIA) today showed a larger-than-expected draw in the US crude oil inventories, the barrel of West Texas Intermediate struggled to stage a recovery as investors remained focused on OPEC’s monthly oil report, in which the organization lowered its global oil demand growth forecast amid economic slowdown. As of writing, the barrel of WTI was losing 1.5% on the day at $56.95.
Earlier today, Statistics Canada reported that the capacity utilization improved to 83.3% in the second quarter to beat the market expectation of 81.8% but was largely ignored by the market participants.
Meanwhile, Canadian Prime Minister Justin Trudeau today announced that they will be holding general elections on October 21.
On the other hand, the selling pressure surrounding major European currencies today allow the Greenback to preserve its strength with the US Dollar Index (DXY) advancing to a fresh weekly high of 98.75 and provides an additional boost to the pair. The US Bureau of Labor Statistic’s monthly data today revealed that the core Producer Price Index (PPI) rose 2.3% on a yearly basis in August to surpass analysts’ estimate of 2.2% and supported the DXY’s upsurge.
Technical levels to watch for