- Crude oil prices gain traction on renewed trade optimism.
- Persistent USD weakness helps the USD/CAD pair find support.
- Markets ignored the inflation data from the United States.
The USD/CAD pair fluctuated in a narrow band above the 1.33 mark for the majority of the day before coming under modest bearish pressure in the last hours with the rising crude oil prices allowing the commodity-related Loonie to gather strength against its rivals. After touching a session low of 1.3272, the pair erased a small portion of its losses and was last seen trading at 1.3290, down 0.3% on a daily basis.
Shortly after the United States(US)-China high-level trade negotiations kicked off in Washington on Thursday, an official from the US Chamber of Commerce said there was a possibility of a currency agreement in trade talks in exchange for a delay in tariff hikes. Moreover, Chinese Vice Premier Liu He voiced China’s willingness to reach an agreement “on matters that both sides care about.”
The improved risk sentiment provided a boost to crude oil prices and the barrel of West Texas Intermediate is now up 1.3% on the day at $53.50.
USD can’t shake off the bearish pressure
Earlier in the day, the only significant macroeconomic data release of the day revealed that the core inflation in the US, as gauged by the core Consumer Price Index (CPI), stayed unchanged at 2.4% on a yearly basis in September and failed to trigger a market reaction.
The US Dollar Index, which tracks the Greenback’s performance against a basket of six major currencies, struggled to pull away decisively from the daily low it set at 98.66 after the data and is now moving sideways near 98.80, erasing 0.3% on a daily basis.
Technical levels to watch for