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USD weakness after mixed data

Daily Currency Update

CAD - Canadian Dollar

The Canadian dollar was little changed on Tuesday morning against a weakening US dollar. USDCAD was up 0.06%, trading at 1.2617 at the time of writing.

The US dollar lost some ground to other major currencies after the release of mixed economic data. The US Dollar Index was down 0.19%, trading around 92.44.

US job figures are due on Friday, which investors hope could offer clues on the timing of the Federal Reserve’s asset purchase tapering. The Bank of Canada is due to make an interest rate decision next week.

Key Movers

The euro strengthened against the US dollar, trading near one-month highs, after data showed Eurozone inflation increased to 3% year-on-year in August, above the European Central Bank’s 2% target and a 2.7% forecast. It's been a long time since European inflation hit the heights of 3%. Ten years in fact. Ultra-low inflation was a perennial issue for the former ECB President (and incumbent Italian PM) Mario Draghi but change is afoot in the Eurozone. The question is whether this jump in inflation numbers will sway the current crop at the ECB to move away from their very accommodative monetary policy, a move that could see the euro strengthen, or whether they will keep on dismissing it as simply 'transitory'. EURUSD was up 0.38%, trading around 1.8525 at the time of writing.

Data-driven dollar weakness also boosted the pound this morning. GBPUSD was up 0.27%, trading around 1.3792, closing in on the 1.38 mark.

Another winner in Tuesday morning’s session was the Australian dollar. AUDUSD climbed 0.75%, trading around 0.7368.

Expected Ranges

  • EUR/CAD: 1.486 - 1.495 ▲
  • GBP/CAD: 1.7312 - 1.74 ▲
  • AUD/CAD: 0.9221 - 0.9302 ▲
  • USD/CAD: 1.2583 - 1.2635 ▲