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USDCAD increases as risk aversion exacerbates in the financial markets

Tuesday 6 September, 2022

Daily Currency Update

The relatively strong fundamentals of the Canadian economy against the USD and G7 have made the Canadian dollar’s depreciation against the USD less painful today. The USDCAD could not break above 1.3160 this morning, an 8-week high. It is trading at 1.3150 at the moment of this writing. G10 currencies and global stocks are still in a high volatility environment, so that we might see more significant swings than usual in the currency market in September.

Key Movers

Global Equity markets and the EURUSD pair gave up gains today; both are still trading under pressure to the downside. USDJPY reached a new 24-year high today, and it hit 143.07 despite Japanese authorities saying they have a “high sense of urgency”, referring to the very weak yen.  Gazprom from Russia announced an indefinite suspension of gas flows to Europe through Nord Stream 1 pipeline.  The pressure to the downside on EURUSD might continue as long as the worsening of the energy crisis continues to build. Euro shared currency is vulnerable to Russia’s gas supply. Even a more aggressive ECB is unlikely to help the EURUSD pair despite the high prospect of a 75bp hike this week. The relatively strong fundamentals of the Canadian economy against the USD and G7 have made Canadian dollar's depreciation against the USD less painful today. The USDCAD could not break above 1.3160 this morning, an 8-week high. It is trading at 1.3150 at the moment of this writing.

Expected Ranges

  • EUR/CAD: 1.2988 - 1.3088 ▼
  • GBP/CAD: 1.5120 - 1.5237 ▲
  • AUD/CAD: 0.8852 - 0.8949 ▼
  • USD/CAD: 1.3098 - 1.3168 ▼