Home Daily Commentaries CAD strengthens as oil prices surge

CAD strengthens as oil prices surge

Daily Currency Update

CAD - Canadian Dollar

The Canadian dollar strengthened against a broadly weakening US dollar on Monday. USDCAD was down 0.67%, trading around 1.2563 at the time of writing.

Markets are looking at the central banks and how they could respond to higher inflation. US non-farm payroll data is due on Friday and a figure of 450-500K is expected, which may allow the US Federal Reserve to continue with plans to announce tapering in November.

Oil prices also surged after OPEC+ agreed it would stick to a gradual plan to increase oil output, which helped boost demand for CAD.

Key Movers

EURUSD has advanced for two consecutive sessions now as it climbed back into the 1.16 region following its yearly lows last week around the 1.1560 mark. This week a key determinant in the currency pair could be the responses of central banks to the inflation surge. We have little economic data due out of the Eurozone this week, but there are some key European Central Bank speakers to look out for. EURUSD was up 0.29%, trading at 1.1628 at the time of writing.

The pound recovered a bit on Monday after being the victim of ongoing Brexit troubles and an energy crisis. Volatility in the currency has picked up in September and is now on par with levels last seen in July. The pound was up 0.54% against the US dollar at 1.3618 and up 0.25% against the euro at 1.1708 at the time of writing. This week no economic data is due out of the UK so the pound could be sensitive to energy crisis news and central bank discussions.

Expected Ranges

  • EUR/CAD: 1.4614 - 1.4677 ▼
  • GBP/CAD: 1.7094 - 1.7156 ▼
  • AUD/CAD: 0.9155 - 0.9197 ▼
  • USD/CAD: 1.2561 - 1.265 ▼