- Surging crude oil prices help loonie outperform its rivals.
- Barrel of WTI climbs toward $60 after EIA data.
- US Dollar Index remains on track to finish the day flat.
After spending the majority of the day in a tight range above the 1.3150 mark, the USD/CAD pair came under heavy bearish pressure during the American trading hours and fell to its lowest level since early February at 1.3105. As of writing, the pair was trading at 1.3117, losing 0.38% on a daily basis.
Earlier today, crude oil prices gained traction on hopes of the U.S. and China ending the trade conflict at the G20 summit following Treasury Secretary Mnuchin and President Trump’s comments. Mnuchin claimed that 90% of the deal was completed and Trump said that it was possible to make a deal when he meets Chinese President Xi this weekend.
Later in the day, the weekly report published by the U.S. Energy Information Administration (EIA) revealed that crude oil stockpiles in the U.S. declined by 12.8 million barrels in the week ending June 21 and provided a fresh boost to oil. The barrel of West Texas Intermediate jumped to its highest level since May 23 at $59.90 and helped the commodity-sensitive loonie outperform its rivals.
On the other hand, the US Dollar Index struggled to build on yesterday’s recovery gains amid disappointing macroeconomic data releases. The U.S. Census Bureau today reported that durable goods orders declined by 1.3% on a monthly basis in May and the good trade deficit rose to $74.55 billion from $70.92 billion. The DXY was last seen flat on the day at 96.20.
Meanwhile, San Francisco Federal Reserve Bank President Mary Daly voiced her concerns about the direction of inflation and said slowing growth and headwinds could strengthen the argument for a rate cut.
Technical levels to watch for