The Canadian dollar today gave up most of its gains against the US dollar as the latter rallied boosted by the risk-off market sentiment as stimulus hopes dissipated. The USD/CAD currency pair rallied higher during the American session as President Donald Trump dashed all hopes of a US stimulus deal ahead of the November 3 elections.
The USD/CAD currency pair today rallied from a low of 1.3242 during the Asian market to a high of 1.3316 during the American session but was slightly off these highs at the time of writing.
The currency pair started off trading sideways given the lack of major releases from either country and was largely underpinned by the positive crude oil prices as tracked by the West Texas Intermediate. Crude oil prices had rallied over the past two days lifting the commodity-linked loonie. Investors were also hopeful that the return of President Donald Trump to the White House would boost his chances of reelection, which caused the markets to rally. However, his latest tweets about postponing stimulus package negotiations with the Democrats until after the election caused the US markets to nosedive.
The release of Canada’s international merchandise trade report for August also contributed to the loonie’s weakness. According to Statistics Canada, the country exported goods worth less than its imports raising its trade deficit to $2.45 billion versus the expected $2 billion.
The currency pair’s future performance is likely to be affected by crude oil prices and US dollar dynamics.
The USD/CAD currency pair was trading at 1.3303 as at 20:21 GMT having risen from a low of 1.3242. The CAD/JPY currency pair was trading at 79.37 having fallen from a high of 79.79.
If you have any questions, comments, or opinions regarding the Canadian Dollar, feel free to post them using the commentary form below.
