USD/CAD Open: 1.2307-11, Overnight Range: 1.2301-1.2328, Previous Close: 1.2321
WTI Oil is at $74.07 and gold is at $1,777.20. US markets are mixed today.
For today, USD resistance is at 1.2307. Support is at 1.2277.
• US Infrastructure Spending plan not a done deal
• Markets cautious ahead of Fed-favourite PCE inflation data
• US dollar opens slightly lower but still close to flat
The Canadian dollar was directionless in another uneventful overnight session. Traders are content to await further guidance from the PCE inflation report, which is said to be the Fed’s preferred measure of inflation. Higher than expected results will reignite the debate as to the timing of the next US rate increase, and undermine the Canadian dollar.
Don't Waste Money With Banks.
Get Exchange Rates Up to 2% Better With KnightsbridgeFX
The euphoria following news of the US Bi-partisan infrastructure spending plan powered Wall Street to a record close yesterday, and Asia indexes followed suit. European traders are far more cautious, and bourses are treading water. S&P 500 futures are a touch firmer. Oil prices retreated from their best levels, while gold nudged modestly higher. 10-year US Treasury yields are steady at 1.492%.
A flock of Fed officials offered contrary opinions about monetary policy, tapering and interest rates this week which created a bit of volatility in markets. Former New York Fed President William Dudley suggests that most of them should be ignored. He said the only opinions that count are from Fed Chair Powell, Vice Chair Clarida, and NY Fed President Williams, as they set the agenda.
EURUSD traded in a 1.1928-1.1950 range. Traders are hoping that today’s US PCE data will provide some direction. Even so, the contrasting ECB and Fed monetary policies suggest EURUSD gains will continue to be capped in the 1.1970-1.2000 area.
GBPUSD dropped from 1.3980 pre-Bank of England meeting to 1.3888 after the BoE failed to deliver an anticipated hawkish message. Prices drifted in a 1.3898-1.3944 range overnight. Policymakers have torn a page from Fed Chair Powell’s playbook and say they are focused on employment, while believing inflation gains to be transitory.
USDJPY dropped from 110.97 yesterday to 110.67 in Europe, then popped to 110.80 in early NY trading. The currency pair is underpinned by US Treasury yields, and awaits PCE data for further direction.
AUDUSD and NZDUSD managed to squeeze out small gains compared to Thursday’s opening level, on the back of improved risk sentiment following the US infrastructure news.
The Canadian dollar is rangebound. USDCAD traded in a narrow 1.2301-1.2328 range overnight, and direction is dictated by broad US dollar sentiment, and oil price movements. The longer-term technicals are bearish below 1.2490, while support in the 1.2000-50 area puts a floor on the downside.
US PCE and Michigan Consumer Sentiment data are ahead.
Today’s Suggested Range USD/CAD: 1.2260 – 1.2360
We are built to beat bank exchange rates and save you money
KnightsbridgeFx is registered with FINTRAC, under the MSB registration number M09819788. Like most financial institutions, we are required to validate the identity of all clients. We have strict measures in place to protect your privacy.
Our Offices
Main office (Appointment only)
First Canadian Place
100 King Street West
Suite 5700 Toronto, ON,
M5X 1C7
(416) 479-0834
Toll-Free: 1-877-355-5239
Fax: 1-877-355-5239
All rights reserved. Knightsbridge Foreign Exchange
Currency Exchange Canada.
