Daily Currency Update

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Loonie gains ground with commodities

CAD - Canadian Dollar

The tight correlation between equity markets and the Canadian dollar continued yesterday, as markets posted positive gains and the Loonie strengthened against the dollar.

The S&P 500 rose 0.7% on the day, and the Canadian dollar hit a low of 0.7405 against the US Dollar yesterday. The gains continued, and the Canadian dollar is trading above 0.7408 this morning. The risk sentiment extended to commodity markets, as copper and gold both posted strong gains. These moves were a sign of confidence from investors that the global recovery has begun and demand for these commodities will rebound.

In upcoming releases, Japan, Germany, America and the Eurozone release PMIs.

Key Movers

The Australian and Kiwi dollars benefited from broad based USD weakness overnight. After hitting highs just above 0.6935, AUD/USD fell to lows under 0.6860 while NZD/USD hit lows of 0.6437. As with GBP and the EUR, both the antipodean currencies regained much of their loses and start today's trading pretty much unchanged.

For the most part, the Pound regained much of its early loses through Monday trading, moving from a low of 1.2335 back above the 1.24 handle. Overnight Asia trading seemed to be shaping up to continue the same path, however, during an interview with Fox News, Assistant to the President Peter Navarro said that the US-China trade agreement was over.

Expected Ranges

USD/CAD: 1.349 - 1.356 ▼

GBP/CAD: 1.683 - 1.692 ▼

EUR/CAD: 1.522 - 1.532 ▼

CAD/AUD: 1.062 - 1.073 ▲