Daily Currency Update

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The Loonie rises after likely good news from final changes to the U.S.-Mexico Canada Agreement

CAD - Canadian Dollar

The Loonie trades flat this morning after a moderate rally during yesterday's trading session, when the Loonie increased by around 0.1 percent against the U.S. dollar. The fundamental catalyst was the trend in housing starts, which came in at 219,047 units in November 2019, compared to 218,253 units in October 2019, according to the Canada Mortgage and Housing Corporation (CMHC).

Furthermore, the U.S. dollar has fallen against the Canadian dollar after an announcement that senior U.S. and Canadian officials are set to fly to Mexico City today to work on final changes to the U.S.-Mexico Canada Agreement (USMCA) that could help the way for a vote in the U.S. Congress before the end of the year.

Technically speaking, the USD/CAD pair is trading in a consolidation mode this morning and it is trying to find direction after a sharp fall last week, when the USD/CAD pair jumped (Loonie depreciated) from 1.3173 towards 1.3269. This morning, it is trading between a range of 1.3219 and 1.3265, with a strong support level around 1.3191 and a clear resistance level at 1.3293. Once those levels are broken, the USD/CAD pair might pick a direction quickly. The most important event scheduled for this week will be the speech by BoC Chair Poloz on Thursday.

Key Movers

This week is full of risk events. The main event remains the fate of the tariffs, but this is a busy week that will include the U.S. CPI, Fed-FOMC and ECB meetings, and the U.K. election.

The U.K. did not produce any growth in the third quarter, leaving the country with an expansion rate of little more than 1 percent this year as Brexit uncertainty continues to take its toll. However, the Pound is trading higher as the Conservatives continue to show a strong lead in the polls.

Expected Ranges

USD/CAD: 1.3219 - 1.3293 ▼

EUR/CAD: 1.4640 - 1.4687 ▲

GBP/CAD: 1.7417 - 1.7507 ▲

AUD/CAD: 0.9009 - 0.9032 ▼

NZD/CAD: 0.8637 - 0.8680 ▼