- European Central Bank delivered an inadequate package, BoC on hold.
- Federal Reserve’s hawkish cut exposes the downside in EUR crosses.
EUR/CAD has lost its footing on a strong Canadian dollar and oil prices following a steady hand fro the Bank of Canada of late, a strong Canadian economy, relatively, and tensions in the Middle East.
BoC and Oil to support CAD
EUR/CAD is currently trading at 1.4642 and flat in the Asian session, having fallen from a high on the 1.47 handle to a low of 1.4623 overnight. The price of oil has found support at the 200-hour simple moving average around 58 the figure, way off the start of the week’s spike highs in the 63 handle following the reports of the Suadi oil facility attack.
However, the US has downplayed the provocations and has expressed an unwillingness to engage in war with Iran and the Saudis are confident that production will be back to full capacity by the end of this month. Nevertheless, tensions and uncertainty are likely to underpin the price of oil and the Loonie.
Meanwhile, the European Central Bank delivered an inadequate package in the market’s opinion and leaves the door open for further action in due course which should be a weight on the euro, especially following the Federal Reserve’s hawkish cut which exposes the downside in EUR crosses.
EUR/CAD levels
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