Daily Currency Update

Get access to our expert daily market analyses and discover how your currency has been tracking with our exchange rate tools

Loony continues gain against dollar

CAD - Canadian Dollar

The Canadian Loonie rallied 2.6 percent versus the US dollar last week, in line with other commodity currencies.

Strong Canadian employment numbers, with May’s labor market report showing an unexpected gain also helped the CAD. The Bank of Canada (BoC) kept its rate at 0.25%, noting that market conditions have improved, and the economy appears to be avoiding worst-case scenarios.

Meanwhile, the Federal Reserve’s upcoming meeting and statement take center stage this week, and with a new perspective, after Friday’s positive jobs report.

The US economy added 2.5m jobs, beating expectations of 7.5m job loses, according to the Non-Farm Jobs report released last Friday. Half of these jobs were added in the restaurant and food sector as businesses rushed to open ahead of Memorial Day. Although the USD ended the week with loses against all G10 currencies, the easing restrictions on US businesses paint a rosier picture for the USD. But what does all of this mean for the USD now and the Federal Reserve? Well, the Fed is now meeting under slightly rosier circumstances, but it isn't expected to change its tone too much. If anything, it entrenches the view that negative rates aren't an option or a necessity.

Key Movers

Across the pond, the latest round of talks between the EU and UK on their post-Brexit relationship seems to have made minimal progress ahead of their meeting later this month. After their latest virtual meetings last week, it is reported that the two camps remain far apart on core issues such as fishing water, law making and business regulations. Boris Johnson and his team are still standing by their deadline which is currently the end of 2020.

European Central Bank President and fiscal stimulus crusader Christine Lagarde speaks. For the EU the focus now shifts to the detail around its newly announced €750bn stimulus package with diplomats expected to begin discussing the details this week. Early today we had German industrial production figures which unsurprisingly were dire with the 70% drop in car productions standing out.

Expected Ranges

CAD/USD: 0.7443 - 0.7476 ▲

EUR/CAD: 1.511 - 1.5169 ▲

GBP/CAD: 1.511 - 1.5169 ▲