Crude Oil Sets Canadian Dollar to Record High

The Canadian dollar touched the highest rate in 2 weeks after risk appetite returned to commodities and equities markets, forcing the main Canadian export, the crude oil, up, and consequently affecting positively the rates for the loonie mainly versus its U.S. counterpart that lost versus most of the majors today.
A session of high risk appetite today provided support for the Canadian currency to outperform several other currencies and touch the highest rate in 15 days versus the greenback, as Chinese manufacturing had the sharpest increase in 5 years during the past month, according to a report published today. The crude oil rose to as high as $78.90 providing support for the already bullish pattern in the Canadian currency charts. Only this year, the commodity rose 76 percent, being a main responsible for the loonie’s rally, as the Canada is a key-energy supplier for its neighboring United States, which is increasing its demand for oil as the economy recovers.
The return of risk in trading markets is being extremely favorable for Canada, witnessing a rebound for the loonie’s rates as the U.S. dollar entered again a losing pattern that has set it to record lows versus several high-yielding and emergent market currencies. The Canadian dollar is likely to gain towards parity with the U.S. dollar if this high-risk trading scenario maintains unchanged.
USD/CAD traded at 1.0424 as of 17:11 GMT from a previous rate of 1.0550 yesterday.

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