CAD - Canadian Dollar
The Canadian dollar hit its highest level against the US dollar since 2018 on Wednesday amid climbing commodity prices and comments about rising inflation from the US Federal Reserve.
The Canadian dollar has been steadily rising against the USD since the Bank of Canada signalled a potential interest rate hike could be on the table in late 2022. By contrast, the US Federal Reserve quashed any talk about tapering any time soon. Analysts suggest the Bank of Canada’s more decisive path could help support the Canadian dollar against the US dollar.
The market is becoming more and more comfortable with the idea that the UK is set to rebound out of this pandemic in a healthy fashion, and with it, the pound has benefitted. Retesting of key psychological levels of 1.40 on GBPUSD and 1.16 on GBPEUR remain a real possibility in the coming days. A stronger GBP depends on action with the euro and USD.
The US dollar inched off three-month lows today after first-quarter GDP for the year increased at a 6.4% rate, just below the market forecast of 6.5%. This signals the US economy is rebounding faster than global counterparts, with the vaccination program and two previous rounds of Covid-19 stimulus relief proving to boost consumption and domestic demand.
Yesterday, the US dollar index fell to 90.55 – the lowest level in almost 5 weeks after comments from the Federal Reserve meeting. Chairman Jerome Powell acknowledged an uptick in economic activity, but also noted inflation pressures could rise in the coming months. As expected, The Fed left interest rates unchanged and close to zero.
1.489 - 1.496 ▼GBP/CAD:
1.713 - 1.721 ▼AUD/CAD:
0.961 - 0.9614 ▼USD/CAD:
1.228 - 1.238 ▼