CAD holds steady amid future rate cut speculatio
Daily Currency Update
The Canadian dollar was mostly unchanged in overnight trading and settled into a narrow range just below the 1.3750 mark. Bank of Canada Governor Tiff Macklem spoke on a panel with other central bank representatives yesterday. Macklem and her peers noted during the BoC meeting that additional future rate cuts are possible down the road. West Texas Intermediate (WTI) crude oil sat near the 78.38 mark this morning, building on a 0.8% gain from yesterday.Key Movers
The US Dollar Index (DXY) rose by 0.18% so far today to sit near the 104.876 level. The USD seemed to settle down after suffering losses against some major currencies with soft inflation data and unchanged interest rates released yesterday. The Bureau of Labor Statistics reported on Wednesday that inflation in the US, as measured by the change in the Consumer Price Index (CPI), declined to 3.3% on a yearly basis in May from 3.4% in April. The annual core CPI, which excludes volatile food and energy prices, rose 3.4%, compared to analysts' estimates of 3.5%. On a monthly basis, the CPI was unchanged, while the core CPI was up 0.2%. The Federal Reserve also held interest rates at 5.5% yesterday, as expected. Chairman Jerome Powell said they need more good inflation data to bolster their confidence that inflation is moving towards the 2% target before rate cuts can happen.In the Eurozone, the EUR/USD pair climbed above 1.0850 on Wednesday but erased a portion of its daily gains later in the American session. The pair held steady at around 1.0800 during the European morning today. With central meetings out of the way, the focus will be on the French Election which could cause movement in the EUR.
The GBP/USD pair touched its highest level since early March above 1.2850 on Wednesday but struggled to keep up the bullish momentum. This morning the pair was trading modestly lower on the day at around 1.2780.
The USD/JPY pair registered small losses on Wednesday and climbed back above the 157.00 level during the European morning on Thursday. The Bank of Japan (BoJ) will announce monetary policy decisions during the Asian trading hours on Friday which also could impact the market.
Expected Ranges
- EUR/CAD: 1.48077 - 1.48610 ▼
- GBP/CAD: 1.75396 - 1.75800 ▼
- AUD/CAD: 0.912500 - 0.915580 ▼
- USD/CAD: 1.37150 - 0.37634 ▲