Canadian Dollar Update, September 30, 2020 – Canadian Dollar recoups Asia losses
USD/CAD Open: 1.3359-63, Overnight Range: 1.3304-1.3420
WTI Oil is at $39.86 and gold is at $1,897.60. US markets are higher today.
For today, USD resistance is at 1.3348. Support is at 1.3276.
• Presidential debate anything but presidential
• Canadian dollar outperforming G-10 peers
• Canada July GDP data shows growth of 3%
FX and equity markets experienced a bit of chop during President Trump and Joe Biden’s debate.
The Canadian dollar sank, alongside the rest of the G-10 major currencies. USDCAD touched 1.3419, after closing at 1.3390. The move didn’t last, and the Canadian dollar opened unchanged compared to Tuesday’s closing level. It was the best performing currency overnight.
EURUSD traded lower, falling from 1.1754 to 1.1694, on the back of both, safe-haven demand for US dollars and month end flows. Prices were also weighed down by dovish comments from ECB President Christine Lagarde who hinted that the central bank may adopt US-style inflation targeting. Traders were also concerned when German Chancellor Angela Merkel warned of a delay in the European Recovery Fund implementation. However, better than expected German August Retail Sales and September employment data provided a bit of support.
GBPUSD fell alongside EURUSD, dropping from 1.2872 to 1.2807. The currency is under pressure from month-end portfolio rebalancing demand for US dollars, however losses were slowed by progress on the EU/UK trade negotiation front. The UK Guardian reports that Britain has offered concessions to the fishing rights issue. The UK is suggesting a three-year transition period for European fishing fleets, with decreasing quotas until 2024. Meanwhile, Bank of England Chief Economist Andy Haldane offered optimistic comments about the economy, saying markets were too negative.
USDJPY traded erratically in a 105.45 to 105.80 range, hitting the top and bottom in Asia, then climbing to the peak again, in Europe and early NY trading. Month-end flows are underpinning the currency pair.
AUDUSD and NZDUSD bounced around during the Presidential debate.
Better than expected China PMI data supported prices.
Today’s US data includes GDP and Chicago PMI.
Today’s Suggested Range USD/CAD: 1.3300 – 1.3400