- The Canadian dollar has won a full percentage compared to the US dollar.
- The Loonie has climbed to seven months' peaks against the USD when commercial threats are resuming.
- Canadian economic data was thin this week, leaving CAD following the flows of large markets.
Friday, the Canadian dollar (CAD) fired a huge boost from the weak back-back on a market scale. The Loonie climbed a full percentage against the US Dollar de Gaking (USD) following a new batch of strangely familiar pricing threats from the United States (United States), Donald Trump.
Canadian economic data was strictly half-level during most of this week of negotiation, leaving the Huard at the mercy of a broader feeling of investment. Next week will also start with a slim note: the American markets will be closed for an extended weekend, and there are few grades on each side of the data file next week until the print of the personal consumer price index on Friday.
Daily Digest Market Movers: traders of the Canadian dollar benefit fully from the weakness of the green back
- The Canadian dollar tested its highest offers against the US dollar on Friday, pushing the USD / CAD pair in 1.3720.
- US President Donald Trump wants to priced individual technological companies This does not pivot their entire business model to produce their goods in the United States, despite the entire production cycle built around the margins of the importation of goods from countries with lower wages.
- President Trump also returned to “recommend” a rate of 50% of the goods imported from the European Union (EU) in a rehearsal of identical tariff threats from which Trump had already retreated in the first quarter.
- The American markets will be closed on Monday for the Memorial Day weekend, the flows of the award market early next week.
- The inflation of the American PCE will be key printing next week, but the main inflation measures are still lacking possible benefits of prices.
Canadian dollar price forecasts
The Canadian dollar is now testing seven -month summits compared to the US dollar, pushing in its best offers compared to the greenback since last October. The Loonie rushes to fill the vacuum left by weakening the pressure of the US dollar, sending the USD / CAD to the 1,3700 handle.
The USD / CAD has decreased for five consecutive negotiation sessions while Greenback Selling takes up the pace. The pair looks at a technical rejection of the 200 -day exponential mobile average (EMA) nearly 1,4020, but too stiff in a fall too quickly made the technical oscillators in territory occur, which implies that a rebound could be on the maps.
Daily graphic USD / CAD
Canadian dollar FAQ
The key factors at the origin of the Canadian dollar (CAD) are the level of interest rate set by the Bank of Canada (BOC), the price of oil, the largest export in Canada, the health of its economy, inflation and trade balance, which is the difference between the value of exports of Canada compared to its imports. Other factors include the feeling of the market – that investors have more risky assets (risk) or are looking for safety havens (risk) – with the risk for the positive CAD. As the most important trading partner, the health of the American economy is also a key factor influencing the Canadian dollar.
The Bank of Canada (BOC) has a significant influence on the Canadian dollar by fixing the level of interest rate that banks can lend each other. This influences the level of interest rate for everyone. The main objective of the BOC is to maintain inflation to 1 to 3% by adjusting increased or declining interest rates. Relatively higher interest rates tend to be positive for CAD. The Bank of Canada can also use a quantitative softening and tightening to influence credit conditions, with the old cad-negative and the last positive frame.
The price of oil is a key factor with an impact on the value of the Canadian dollar. Oil is the largest export in Canada, so the price of oil tends to have an immediate impact on CAD value. Generally, if the price of oil increases, the CAD also increases, because the overall demand for money increases. The reverse is the case if the price of oil decreases. The higher oil prices also tend to lead to a greater probability of a positive trade balance, which also supports CAD.
Although inflation has always been considered a negative factor for a currency because it reduces the value of money, the reverse was in fact the case in modern times with the relaxation of cross -border capital controls. A higher inflation tends to lead central banks to set up interest rates that attract more capital entries from global investors looking for a lucrative place to keep their money. This increases demand for local currency, which in the case of Canada is the Canadian dollar.
Macroeconomic data versions assess the health of the economy and may have an impact on the Canadian dollar. Indicators such as GDP, Manufacturing and PMIS services, employment and surveys on consumer feelings can all influence CAD management. A strong saving is good for the Canadian dollar. Not only does it attract more foreign investment, but it can encourage the Bank of Canada to install interest rates, which leads to a stronger currency. If the economic data is low, however, CAD is likely to decrease.
