Home Daily Commentaries The Loonie rallies along with positive risk sentiment and the US dollar giving up gains.

The Loonie rallies along with positive risk sentiment and the US dollar giving up gains.

Daily Currency Update

CAD - Canadian DollarThe Loonie increased the most in two weeks as the US dollar has fallen due to the positive risk mode in the financial markets.The USD/CAD pair fell to 1.2539, the lowest level since March 23. Another support is 1.2516 (which is the March 23 low). The EUR/CAD pair also slumped as much as 0.5% to the lowest level since February 2020. Technically speaking, there is a resistance at 1.2652, which is the 55-day moving average.On the economic release front, Canada’s economy continued showing surprising strength at the start of the year, despite a second wave of closures that forced many businesses to shut their doors again. Gross domestic product grew 0.7% in January, according to Statistics Canada.

Key Movers

The US dollar falls following a stock market rally. One of the important catalyst was the release of US President Joe Biden’s fiscal plan, which has sparked gains in emerging-market and commodity-linked currencies. Historically, April is the best month for the stock market in North America, so market participants might be positioning in preparation (stocks posted an average gain of 2.4% in April from 2000 to 2020, and they’ve risen in 13 of the last 15 Aprils).On the US economic release front, pending home sales fell 10.6% versus an estimated decrease of 3%.

Expected Ranges

  • USD/CAD: 1.2515 - 1.2592 ▼
  • EUR/CAD: 1.4725 - 1.4773 ▼
  • GBP/CAD: 1.7293 - 1.7350 ▲
  • AUD/CAD: 0.9547 - 0.9583 ▼
  • NZD/CAD: 0.8758 - 0.8800 ▼