Daily Currency Update

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CAD’s mixed week

CAD - Canadian Dollar

The Canadian dollar starts this week with some decent expectations after last week’s performance.

Demand for CAD pushed GBPCAD down 1.75%. At the same time, the Australian dollar outperformed its commodities counterpart CAD by 1.34%. During that time, USDCAD only increased about a tenth of a percent over the week.

So, what is in store for the week ahead? Across the pond, Europe and Britain continue to hash out the final details of a post-Brexit trade deal. Locally, vaccinations should expand throughout the week. So, signs of optimism abound. ‘Tis the season.

Key Movers

Sterling continued to feel under pressure through the end of last week, falling to a low of 1.3134 against the USD, as both the UK and EU stated a ‘No deal’ Brexit was looking more likely. As the self-imposed Sunday deadline approached, Johnson appeared ready to embrace a no-deal Brexit and prepared Royal Navy gunboats to defend UK fishing waters. In the end, talks continued through Sunday with the European Commission President Ursula von der Leyen. Both parties have agreed that negotiators would go "the extra mile" in the next few days to reach a deal.

What a week for the Australian Dollar. Against the Greenback the Aussie has been the best performer and has broken above the key psychological level of 0.75, which was a significant figure from a technical perspective. The main driver has been a surge in iron ore futures thanks to Chinese demand and a potential shortage in supply due to disruptions caused by storms hitting Western Australia. The local unit is closely correlated to commodity prices, so it is no surprise to see the pair rise to these levels. Local markets shrugged off negative news regarding a vaccine being produced by an Australian firm CSL and the University of Queensland, the Australian government has moved to an alternative supply after trials returned a false HIV positive result.

Expected Ranges

EUR/CAD: 1.546 - 1.552 ▼

GBP/CAD: 1.697 - 1.712 ▲

AUD/CAD: 0.961 - 0.965 ▲

USD/CAD: 1.272 - 1.278 ▼