Daily Currency Update

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Business outlook not so bright

CAD - Canadian Dollar

COVID-19 and the resulting drop in oil prices drove business sentiment downward in all regions, according to the Bank of Canada’s summer Business Outlook Survey.

Firms reported that weak demand is reducing both capacity pressures and expectations for price growth. The outlook provides an indication of economic health, and negative sentiment is not so good for the Canadian dollar.

The Loonie has been bouncing around the 1.354 this morning on the release of the report.
Looking ahead for the week, US crude oil inventories will be released on Wednesday. On Friday, Canadian employment numbers will be released.

Key Movers

The UK hospitality sector received a welcome boost this weekend as pubs, restaurants and cinemas reopened after over three months of coronavirus enforced shutdown. Dubbed "Super Saturday,” it came across as a relative success with those fearing hospitals would be overwhelmed with revelers taking it too far. As more and more venues reopen this weekend it will be another test to see how the English public and the sector copes with months of pent up demand.

European Central Bank President Christine Lagarde over the weekend painted a bleak picture for the Eurozone. She listed the likely scenario of two years of downward price pressures as the economy transitions as a result of the pandemic. In the UK, Brexit talks ended prematurely last week as key issues around UK fishing waters and the role of the European court of justice remain sticking points.

Expected Ranges

USD/CAD: 1.352 - 1.356 ▼

GBP/CAD: 1.689 - 1.695 ▼

EUR/CAD: 1.523 - 1.53 ▲