- USD/CAD gains almost a hundred pips at the beginning of the week.
- Loonie among worst performers, as crude oil tumbles.
The USD/CAD rose further during the American session and climbed to 1.3218, reaching the highest level since October 16. As of writing, it trades at 1.3210, up almost a hundred pips from Friday’s close.
A decline in WTI weighs on CAD ahead of BoC
The loonie is the worst performer among commodity currencies on Monday. The sharp decline in crude oil weighed on the CAD. The WTI barrel is under pressure hovering around $38.70, down almost 3%.
At the same time, the greenback remains strong across the board amid risk aversion. The Dow Jones is falling 2.50%, and the Nasdaq declines 1.70%. The DXY is trading at 93.00, testing Friday’s top. The dollar is posting gains even against the yen and despite a retreat in US yields.
Market participants ignored economic data from the US. The negative surprise came from an unexpected decline in New Home Sales. In Canada, attention turns to the Bank of Canada policy meeting on Wednesday. The meeting “will be crafted to meet the Hippocratic oath: first do not harm. As a result, its intent will be to restrict itself to some fine tuning, and avoid any major shifts in a monetary policy stance that is working well, in an economy that isn’t”, explained strategists at CIBC.