Daily Currency Update

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CAD boosted by jump in oil prices

CAD - Canadian Dollar

Demand for the Canadian dollar climbed higher against the US dollar, supported by an ongoing rally in oil prices and other commodities. USDCAD was down 0.43%, trading at 1.2015 at the time of writing.

Oil prices jumped to a two-year high today ahead of an OPEC+ meeting. The Organization for of the Petroleum Exporting Countries and allies (OPEC+) is expected to continue gradually increasing output to meet expectations for growing fuel demand.

The dollar remained under pressure against its major peers this morning. The US Dollar Index was down 0.20% at 89.83 at the time of writing, reversing a climb over the 90-mark last week.

Key Movers

EURUSD continued to push higher, reaching a five-month high of 1.2266 in early trading, driven by events in Europe and the US. EURUSD was trading at 1.2229 at the time of writing. The Eurozone’s vaccine rollout continues to improve which is driving down employment rates, while inflation remains stable. This improved outlook has investors flocking away from safe haven currencies like the US dollar. The US Federal Reserve has indicated that it has no plans to taper its bond purchasing, nor raise rates for the foreseeable future, which is also weighing on USD.

The pound touched a three-year high against the dollar, reaching 1.425 in early morning trade. But GBPUSD pulled back to 1.417 at the time of writing. The early high marked the highest level since 2018 for the pair. In recent weeks, demand for GBP was boosted by the UK’s strong reopening plan and concerns of inflation in the US.

AUDUSD was up 0.01% this morning at 0.7734 after The Reserve Bank of Australia maintained its monetary policy, keeping the cash rate and three-year yield target at 0.10% as expected. Recent uncertainty around the pace of vaccination rollouts, ongoing pandemic supply constraints and rising geopolitical tensions are weighing on the AUD, preventing any extension beyond 0.78 US cents. While we maintain our medium-term bullish outlook against the USD the Australian Dollar has come under pressure when valued against key counterparts, giving up ground to the NZD, GBP, EURO and CAD through May.

Expected Ranges

EUR/CAD: 1.47 - 1.477 ▼

GBP/CAD: 1.703 - 1.717 ▼

AUD/CAD: 0.930 - 0.935 ▼

USD/CAD: 1.201 - 1.208 ▼