Home Daily Commentaries CAD struggles against USD

CAD struggles against USD

Daily Currency Update

The Canadian dollar continued to struggle against its US counterpart after demand for the US dollar picked up again following a dip earlier in the morning. Data showed that US producer prices climbed 0.8% in November, with factory gate inflation at 11-year highs. This seemed to reassure the market that the US Federal Reserve will announce on Wednesday an end to their bond-buying program earlier than anticipated. With the USD expected to be stronger for longer, some analysts think this week’s policy updates will go a long way in shaping near term USDJPY, GBP and EUR direction. With the Fed expected to begin hiking rates in mid-2022, a dovish surprise or failure to meet market expectations could prompt a short-term correction in recent USD upside. USDCAD advanced for a fifth straight day, trading at 1.2847 at the time of writing.

Key Movers

As a wave of new COVID-19 infections sweep Europe and the US, some analysts think concerns over Omicron variant will again derail the global economic recovery and consume market commentary. With plenty of risk events crowding the macroeconomic calendar, this week’s investors appeared content in correcting positions. The euro firmed against the dollar this morning sitting at around 1.1274, while the pound held on to small gains, with GBPUSD sitting around 1.3233 at the time of writing.

Expected Ranges

  • EUR/CAD: 1.4427 - 1.4515 ▲
  • GBP/CAD: 1.6892 - 1.7008 ▲
  • AUD/CAD: 0.9099 - 0.9148 ▲
  • USD/CAD: 1.2784 - 1.2852 ▲