The Canadian dollar today rallied against its US counterpart after the release of positive housing data by Statistics Canada. The rebound in global crude oil prices triggered the USD/CAD’s downward spiral at the start of today’s session even as OPEC and non-OPEC countries consider extending production cuts.
The USD/CAD currency pair lost about 70 points at the height of its decline to hit new three-day lows below the crucial 1.2500 support level.
The commodity-linked Canadian dollar opened today’s session much stronger against the greenback boosted by the higher global crude oil prices as tracked by the West Texas Intermediate. The release of housing starts data for August in the mid-European session boosted the loonie against the greenback given that they beat expectations. The housing starts for September came in at 217,100 versus the expected 212,000. However, the building permits issued in August were lower than expected as they declined by 5.5% from the July figure as opposed to the expected 1.0% decline.
Geopolitical concerns seem to have dampened the sentiment around the greenback even as the US Dollar Index hit new lows around 93.00. The expectations of a FOMC rate hike in December seems to have been overshadowed by the emerging Geopolitical risks in the USA. President Donald Trump seems to prefer a military solution to the ongoing stand-off with North Korea.
The currency pair’s future performance is likely to be affected by global crude oil prices and tomorrow’s release of the September FOMC meeting minutes.
The USD/CAD currency pair was trading at 1.2496 as at 16:22 GMT having dropped from its opening high of 1.2554. The CAD/JPY currency pair was trading at 89.75 having declined from a high of 90.03.
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