Daily Currency Update

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Canadian National Home Sales Fall From November to December.

CAD - Canadian Dollar

Canadian National home sales declined on a month over month(m/m) basis in December by 0.9 percent. The number of newly listed properties dropped 1.8 percent on the month while home sale activity was up 22.7 percent on a year over year basis. MLS Home Price Index Prices saw a marginal advancement of 0.8 percent m/m and 3.4 percent y/y. Canadian national average home sale price climbed 9.6 percent year over year. Other Canadian fundamentals this week will be Canadian ADP Employment Change for December, previous was 30.9K, and the forecast is 51.2K jobs added. The loonie has seen very little volatility this week trading well-entrenched this week at 1.3029 to 1.3089. A breakout of this range may not come until after the Bank of Canada's interest rate decision and monetary policy report(MPR) next Wednesday, January 22. Expectations are priced in with the central bank highly expected to hold rates steady at 1.75 percent. The MPR will be eyed closely by market participants as the report will set the tone from the BOC for its outlook in 2020.
WTI crude oil has settled in at 58.00 dollars per barrel after spiking to 65.67 last week after the Iranian ballistic missile attack on the U.S. and Iraqi interests in Iraq, geopolitical turmoil in the region was the cause of the move higher. Oil seems to be grappling for a bid after President Trump said in a statement following the attacks last week, the U.S. does not need Middle East oil.

Key Movers

The risk-on sentiment extended into Asia this Tuesday after the U.S. Treasury retracted its decision in August to designate China as a currency manipulator. The market mood was given another lift with the imminent sign off on phase one trade deal between the U.S. and China due to take place today, January 15.
Attention now turns to the U.S. Producer Price Index released today as investors prepare for a big week of US domestic data points, headlined by PPI excluding food and energy released at 1.1 short of previous and consensus of 1.3 percent, respectively. Softness across these data points will affirm suggestions the U.S. economy is shifting nearer recession and subsequently increase the likelihood that monetary policy amendments will be required at some point through 2020.

Expected Ranges

USD/CAD: 1.3046 - 1.3079 ▼

EUR/CAD: 1.4522 - 1.4583 ▲

GBP/CAD: 1.6979 - 1.7034 ▼

AUD/CAD: 0.8990 - 0.9022 ▼

NZD/CAD: 0.8606 - 0.8655 ▼