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USDCAD down after Powell speech

Monday 29 August, 2022

Daily Currency Update

Demand for the US dollar was steady on Monday after US Federal Chair Jerome Powell reiterated last week that the central bank was  committed to raising interest rates “for some time” in order to achieve price stability.  This week will likely focus on the fallout of Powell’s speech, which didn’t land well on Wall Street. The Dow Jones Average finished down 3% last week after the speech, its worst day in three months. The tech-heavy Nasdaq composite shed nearly 4%.  This sour sentiment in the equity markets has helped buoy the safe-haven US dollar this morning. There’s little on the economic calendar Canadian dollar on deck this week so CAD could remain under pressure against USD. USDCAD was trading at 1.29959 at the time of writing.

Key Movers

Eurozone inflation is in focus this week, economists expecting headline inflation hitting 9% in August when data is released on Wednesday. This could give the European Central Bank (ECB) more concrete evidence for another rate rise on September 8th. EURUSD was trading just below parity on Monday morning around 0.099982. GBPUSD struggled on Monday morning amid thin trading due to a bank holiday in the UK and a quiet week for economic data. GBPUSD was down 0.24% trading at 1.712 at the time of writing.

Expected Ranges

  • EUR/CAD: 1.2957 - 1.3043 ▲
  • GBP/CAD: 1.5226 - 1.5304 ▼
  • AUD/CAD: 0.8945 - 0.8995 ▲
  • USD/CAD: 1.2994 - 1.3074 ▼