The Loonie is consolidating gains from last week
Monday 9 September, 2019
Daily Currency UpdateCAD - Canadian DollarThe USD/CAD pair began trading at 1.3155, 0.06 percent lower this morning. The USD/CAD pair trades between a daily range of 1.3150 and 1.3180 when there is no local news, despite global stocks trading higher in a clear risk-on market environment. Neither a flat-trading U.S. dollar index nor robust crude oil price action is showing any evident influence on the Loonie in the wake of a strong labour market report on Friday. Regarding crude oil, in Saudi Arabia, Khalid al-Falih was replaced as Energy Minister by Prince Abdulaziz bin Salman, who was an energy ministry veteran and the half-brother of Crown Prince Mohammed bin Salman. Saudi Arabia has not previously delegated the entire oil ministry to a member of the royal family. As such, the move appears to be more of an attempt to consolidate power by Mohammed bin Salman. Abdulaziz said that there would be no radical change to Saudi Arabia’s output policy. However, crude oil prices have increased, supported by Iran's final break with the UN agreement limiting its nuclear enrichment limits and by Baker Hughes' rig count that showed the number of active oil rigs falling to the lowest in two years last week.
Key MoversChina's economy is aching from the imposition of U.S. tariffs. Recent data showed exports down by 1 percent on the year in August, below the market expectation of 2 percent rise, with China's exports to the U.S. tumbling 16 percent in August. China's trade surplus fell by nearly a quarter to $ 34.8 billion from $ 45 billion in July. As shown days ago, the U.S.' trade deficit with China is contracting. The USD/CNH pair is increasing by 0.22 (weaker Chinese Yuan). In Europe, the German trade balance gave us signs of life following recent damage to the German economy, with exports adding a gain of 0.7 percent on the month in July. The EUR/USD pair advances 0.24 percent at the time of this writing. Over the weekend in the U.K., the GBP/USD has risen 0.64 percent, likely due to a modest upside surprise from July's industrial output and construction data. The Pound was also indirectly boosted by the House of Commons, which is starting to debate the possibility of a snap General Election. Amber Rudd, a senior minister, resigned from Johnson's government saying that she saw no evidence that he wanted to secure a deal with the EU before the Oct. 31st deadline. Furthermore, Boris Johnson held talks in Dublin with Irish PM Leo Varadkar as a pivotal week for the Brexit kicks off.
- USD/CAD: 1.3148 - 1.3192 ▼
- EUR/CAD: 1.4498 - 1.4580 ▲
- GBP/CAD: 1.6025 - 1.6323 ▲
- AUD/CAD: 0.8989 - 0.9047 ▲
- NZD/CAD: 0.8400 - 0.8424 ▼