The Canadian dollar today fell against its US peer as global crude oil prices fell to new lows as Saudi Arabia plans to up production as the oil price war heats up. The USD/CAD currency pair rallied to the 1.4400 high that was last seen in 2016 as demand for the greenback soared driven by the dominant risk-off market sentiment.
The USD/CAD currency pair today rallied from a low of 1.4166 in the Asian session to a high of 1.4467 in the early American session and was headed higher at the time of writing.
The currency pair’s rally was largely fueled by the massive drop in global crude oil prices as tracked by the West Texas Intermediate, which fell to a low of 23.57 earlier today. Investors are worried that Saudi Arabia will hike its crude oil production to 12.3 million barrels per day amid weakening global demand for the commodity. Investors were also worried about the potential impact of the coronavirus pandemic on Canada’s oil exports. Two provinces have already declared a state of emergency to combat the spread of the COVID-19 coronavirus.
The currency pair had a muted reaction to the release of Canada’s consumer price index report for February by Statistics Canada. According to the report, Canada’s core inflation print came in at an annualised 1.8% beating consensus estimates set at 1.7%.
The loonie’s future performance is likely to be affected by speeches from Canada’s Prime Minister Justin Trudeau and Bank of Canada Governor Stephen Poloz scheduled for 14:30 GMT.
The USD/CAD currency pair was trading at 1.4455 as at 13:48 GMT having risen from a low of 1.4166. The CAD/JPY currency pair was trading at 74.,70 having fallen from a high of 75.68.
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