Thursday, December 6, 2018
The CAD is extending yesterday’s losses in the wake of the Bank of Canada rate announcement and the dismal outlook for the Canadian economy. News disappointed today with the Trade Balance showing a big miss coming in at -1.2B vs. the expected -0.7B. BoC Governor Poloz is speaking throughout the morning and facing questions on the future path of the central bank.
The USD is benefiting from investor risk aversion and an equity market decline this morning. The arrest and possible extradition of Huawei CFO has triggered a fear across markets that US/China relations could potentially deteriorate further. News was mixed with ISM Non-Manufacturing PMI beating the 59.1 forecast at 60.7, while Unemployment Claims were slightly higher than the 226K expectation at 231K.
The EUR has consolidated near the mid-point of its recent range. It is expected that the EUR should continue to trade in a narrow range at least for the meantime. The ECB is most likely looking to move ahead with their policy normalization plan at the mid-December meeting.
Equities are down across the board this morning: the Dow down 2.02%, the S&P down 1.75%, NASDAQ down 1.52% and the TSX down 1.87%. Crude Oil is down 4.12% this morning ($50.71) while Gold is up 0.41% ($1,242.31).
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