The Loonie is still trading sideways as we await the BoC meeting next week.
Thursday 1 January, 1970
Daily Currency UpdateCAD - Canadian DollarThe Loonie is still trading steady versus the U.S. dollar after a period of low volatility for the Petro currency as market participants look to the next week’s Bank of Canada meeting. For now, market participants are expecting to hold rates steady at 1.75 percent, and the USD/CAD pair trades at 1.3050 at this moment. Market participants are focusing on fundamentals for the Loonie because of the prevalent risk-on mood and optimism over the long-awaited U.S.-China phase one trade deal, which is not helping the Canadian dollar to soar. Furthermore, crude oil, another vital catalyst, traded sideways in overnight trading following worries of abundant supply, which could push the Loonie lower.
Key MoversIn the U.K., the main driver of the Pound was the release in retails sales numbers. Retail sales surprisingly decreased in December. The volume of goods sold in stores and online fell 0.6 percent, versus expectations of a +0.6 percent increase. Money markets now price a 75 percent chance of a rate cut on January 30th, compared with 62 percent on Thursday, according to Bloomberg. The GBP/USD pair had hit a high of 1.3120 before the release of retails sales at 4:30 am EST, but it erased all its gains following the lower than expected retail sales numbers, touching an intraday low of 1.3026. It is trading at 1.3056 at this moment. The Chinese Yuan also advanced after China reported better than expected industrial output and retail sales. However, the Yuan reversed gains, and it is falling 0.2 percent versus the U.S. dollar around 9 am EST.
- CAD/USD: 1.3033 - 1.3059 ▲
- EUR/CAD: 1.4477 - 1.4538 ▼
- GBP/CAD: 1.6999 - 1.7110 ▼
- AUD/CAD: 0.8980 - 0.9013 ▼
- NZD/CAD: 0.8630 - 0.8674 ▼