Canadian Dollar Rallies with Crude Oil, Not Bothered by Mixed Data

The Canadian dollar gained on most of its major peers on Tuesday. While Canada’s economic data was mixed, the silver lining for the currency was the rally of crude oil prices.

Foreign investment in Canadian securities fell from C$5.6 billion in January to C$4.0 billion in February instead of rising to C$7.2 billion as analysts had predicted. Meanwhile, manufacturing sales increased by 1.9% in February, beating the average forecast of a 1.0% increase, after falling 1.3% in January.

Prices for crude oil rose for the sixth time in seven sessions. Traders were mostly worried about potential supply disruptions, though hopes for the Organization of Petroleum Exporting Countries to maintain production caps were also helping the commodity.

Now, traders wait for monetary policy decision by the Bank of Canada at 14:00 GMT on Wednesday followed by a press conference at 15:15 GMT. While analysts did not anticipate any changes to the policy, there believed that the BoC may express optimism about the developments in the Canadian economy. If that is indeed the case, then the Canadian currency should most certainly rise further.

USD/CAD slid from 1.2564 to 1.2552 as of 22:21 GMT today. EUR/CAD fell from 1.5552 to 1.5530. CAD/JPY was almost unchanged at 85.25.

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