Daily Currency Update

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Crude oil pressure pushes Loonie lower

CAD - Canadian Dollar

The USD/CAD pair is increasing this morning (weaker Loonie). The Loonie is struggling to hold gains achieved over the last few days due to weakness in crude oil, which is over 7 percent lower from the previous peak three days ago. This morning, the USD/CAD is trading at 1.3248, representing a 0.29 increase. A bounce from the Greenback after better than expected retail sales numbers are helping the USD/CAD pair to go higher, and the Loonie lower.

The S&P/TSX Composite Index, Canada's main stock index hit fresh record high on Friday as growing optimism around U.S.-China trade talks lifted sentiment.

Key Movers

The U.S. dollar is benefiting almost as much as the Aussie dollar from the U.S.-China trade truce this week. Additionally, with the Interim China deal, Trump administration officials have discussed offering a limited trade agreement to China that would delay and even roll back some U.S. tariffs in exchange for Chinese commitments on intellectual property and agricultural purchases, according to Bloomberg. Furthermore, China added U.S. soybeans and pork to its list of goods exempted from new tariffs. Talks with Washington are planned in the coming weeks.

In the U.K. with Brexit 48 days away, the British Pound has hit its highest level against the U.S. dollar since July amid hopes that a no-deal Brexit can be avoided.

In the ECB’s decision yesterday, there was opposition from ECB governors representing Germany, France, Austria, Estonia, and the Netherlands. However the deposit rate was reduced further to minus 0.5 percent from minus 0.4 percent, and the ECB said it would buy debt from Nov. 1 at a pace of 20 billion euros a month for as long as necessary to hit its inflation target. However, many market participants have mentioned that lower rates and QE are unlikely to have much effect on the Eurozone economy and that Draghi knows that the lack of action would be worse.

Expected Ranges

USD/CAD: 1.3215 - 1.3291 ▲

EUR/CAD: 1.4632 - 1.1,4753 ▲

GBP/CAD: 1.6385 - 1.6504 ▲

AUD/CAD: 0.9107 - 0.9143 ▲

NZD/CAD: 0.8450 - 0.8490 ▼