FX Blog

Daily Market Updates & FX News

FX Blog

Daily Market Updates & FX News

FX Blog

Daily Market Updates & FX News

Again no news out of Canada this morning but the CAD is strong this morning on the back of Gov. Poloz’s statements yesterday. He warned that the Bank of Canada is currently in a reactionary mode based on what happens with the Fed and oil prices over the coming weeks, this makes a March interest cut more unlikely. CAD has rallied almost 2% since yesterday’s lows on reaction from Bank of Canada statements and stabilization of oil prices. Today’s Crude Oil Inventory numbers will be an important factor for CAD strength or weakness throughout the day.
News is again light out of the US with only New Home Sales and Crude Inventories being released this morning. New Home Sales came out a beat at 481K vs. the forecast 471K, we await crude oil numbers later this morning which will be a strong driver for energy based currencies today. Fed Chair Yellen testifies again today after her comments yesterday weakened the USD fairly significantly. Yellen’s testimony yesterday signaled that the Fed hike will be data dependent and relies on inflation numbers increasing back to 2%. She also removed the word patience which suggests a move towards a rate hike but does not guarantee it will happen by June. As long as inflation stabilizes and payrolls remain strong as of recent, we may still see the June or July rate hike.
EUR is flat this morning and with little new flow still trading within its range. No data releases today, however President Draghi speaks later on today which could provide some volatility. EUR is trading well within its ranges and are looking for a catalyst to break it out of its bounds.
Crude is down just under half of a percent this morning and awaits inventory numbers out of the US. These numbers could be a big driver in prices this morning, which could result in some volatility in the CAD value.
Equities are down across the board this morning as the market again reacts to Yellen’s comments: the Dow is down 0.03%, S&P down 0.13%, and NASDAQ down 0.02%. The only outlier being the TSX which is up 0.03%. Crude Oil is down 0.49% this morning ($49.04) while Gold is up 0.66% this morning ($1,205.20).

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