CAD - Canadian Dollar
Canada added 953K jobs in June, while the median consensus estimate was 700k, supporting the possibility of a robust recovery if the pandemic can be controlled. We are starting to see a quick return to work, but there is some concern around federal debt being over CAD $ 1 trillion. The Loonie rose amid broad US dollar losses and as market participants are focused on a Bank of Canada policy decision set for Wednesday.
Wednesday, July 15th, will be a key day for crude oil and probably for the Canadian dollar. The Joint Ministerial Monitoring Committee (JMMC) will evaluate OPEC’s progress and it will decide whether to continue its production cutback of 9.6 million barrels a day for another month or bring back some production as originally planned. If crude oil supply comes back to the market and there is a second wave of Covid-19, crude oil prices will be vulnerable again, along with global stock markets and commodity currencies.
The US dollar continues to fall along with other haven currencies such as the Japanese Yen and Swiss Franc, which are weaker in Monday trading as risk appetite improves ahead of the U.S. corporate earnings reports and a European Union summit later this week.
The Trump administration released a list of imports from France subject to an additional 25% tariff related to a dispute over taxes on technology companies. President Trump told reporters that he isn’t even considering a phase two trade deal with China, because the relationship between the two countries has been “severely damaged” by the coronavirus pandemic.
With less than a week to go before the EU summit, European leaders are facing a potential roadblock: the Netherlands and Mark Rutte. The Dutch Prime Minister is still not convinced on the economic package details, joining other nations such as Austria, Sweden and Denmark, which all want Brussel’s proposals to be amended so loans eventually have to be paid back, replacing ‘free money’. Their move illustrates a big divide within the E.U, as southern members such as Spain, Portugal and Italy have all suffered heavily since the coronavirus pandemic, while less affected nations do not want to be responsible for the collective debt that has built up.
1.3500 - 1.3595 ▼EUR/CAD:
1.5370 - 1.5450 ▲GBP/CAD:
1.7099 - 1.7167 ▼AUD/CAD:
0.9450 - 0.9518 ▲NZD/CAD:
0.8901 - 0.8942 ▲