USD/CAD falls below 1.10 – 4 reasons

The Canadian dollar is making a comeback, and with a  vengeance: USD/UCAD is now trading around 1.0975, falling sharply from the highs seen earlier in the week and making a complete U-turn.

Here are 4  reasons,  followed by the chart:

1. USD sell off: The US dollar is sold off across the board on an almost simultaneous release of an announcement on stimulus in China and also a report that is likely to leave the wording regarding interest rates intact – a “considerable” time. Here is a preview of the FOMC meeting.
2. Strong Canadian manufacturing sales: a rise of 2.5% beat expectations of 1.1% for the month of July. In addition, the figure for June was revised to the upside: from 0.6% to 0.9%.
3. Bounce in the price of oil: After  long days of falls in the price of both Brent and WTI oil, we are seeing a bounce, perhaps related to a brewing storm in the Atlantic. Here is more about oil.
4. BOC optimism: The governor of the Bank of Canada, Sttephen Poloz, says that the Canadian economy is beginning to see  early signs of export recovery and that a “natural sequence we have  been hoping for is under way”.

Here is a chart of USD/CAD, showing the rise and the fall of the pair. For more, see the  C$ forecast.

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The Canadian dollar is making a comeback, and with a  vengeance: USD/UCAD is now trading around 1.0975, falling sharply from the highs seen earlier in the week and making a complete U-turn. Here are 4  reasons,  followed by the chart: USD sell off: The US dollar is sold off across the board on an almost simultaneous release of an announcement on stimulus in China and also a report that is likely to leave the wording regarding interest rates intact - a "considerable" time. Here is a preview of the FOMC meeting. Strong Canadian manufacturing sales: a rise of 2.5% beat…