CAD strengthens against USD
Daily Currency UpdateThe Canadian dollar strengthened against its US counterpart on Monday as the price of oil rose, and following two Bank of Canada surveys that offered clues on the economic outlook.
The central bank's quarterly Business Outlook Survey showed that businesses still face challenges with labor and rising costs. The report further supports expectations for the Bank of Canada to drive up interest rates in a bid to curb inflation. A separate survey of consumer expectations by the Bank of Canada showed Canadian households also expect inflation to stay above 3% over the next few years.
USDCAD was down 0.16%, trading at 1.2497 at the time of writing.
Key MoversThe US dollar continued to see broad strength versus its major peers on Monday, putting fresh pressure on EURUSD. Caution was the market's mood at the start of the week after European leaders called for more sanctions against Moscow in the Russia-Ukraine crisis. Despite a mixed bag of economic data late last week, the US dollar recorded a a meaningful, yet tempered gain on Friday against a basket of currencies. EURUSD was trading below 1.10 at the time of writing, while the US Dollar Index was up 0.32% at around 98.95.
Germany’s defence minister said on Sunday that the European Union must discuss banning imports of Russian gas, a step that could have severe economic ramifications on European growth given the reliance of several Eurozone countries, including Germany, on Russia for energy supplies. The news has seen the EUR lose ground against both the GBP and USD. Data from last week showed Eurozone consumer inflation hitting a fresh record high of 7.5% in March, putting further pressure on the European Central Bank to raise interest rates. The ECB's minutes of its March meeting are due for release on Thursday, and will be studied carefully ahead of the upcoming meeting on April 14.
- EUR/CAD: 1.3711 - 1.3841 ▼
- GBP/CAD: 1.6352 - 1.642 ▼
- AUD/CAD: 0.9373 - 0.9433 ▲
- USD/CAD: 1.2471 - 1.2527 ▼