The Loonie is stronger this morning for second day; the USD/CAD was trading at 1.3170 from 1.3200 yesterday. The cessation to escalating trade tension and a rebound in crude have prompted a recovery for the Canadian Dollar against the Greenback.
Events that might move the Loonie in any direction are interesting this week; the Bank of Canada is meeting this Wednesday to discuss their interest rate levels, where the BoC is expected to maintain the benchmark rate at 1.75 percent and hike it in early 2019. Also, OPEC is meeting in Vienna this Thursday.
A few minutes ago, labor productivity was published at 0.3 percent for the third quarter, lower than the forecast at 0.4 percent. The USD/CAD pair was touching 11-day lows this morning, but how far can the optimism go after the BoC announcement tomorrow? Canada’s current account deficit is narrowing in the third quarter on the back of improvement in the goods and services trade deficits. However, on the negative side, the net direct investment deficit widened sharply. Post-USMCA investor optimism could emerge, but data will tell.