Canadian dollar flexes against partners
Friday 11 September, 2020
Daily Currency UpdateCAD - Canadian DollarDemand for the Canadian dollar strengthened the currency against major partners over the last month.Yesterday, the demand pushed GBPCAD below 1.69 and was the eleventh day of decline for the pair. EURCAD hit a high on August 16 and has steadily declined since then. It broke through 1.56 yesterday in trading.Of course, it’s been roller coaster of highs and lows with Canada’s largest trading partner. After USDCAD touched 1.30 at the end of August, the US dollar has regained some strength. USDCAD broke through 1.32 earlier this week.
Key MoversThe European Central Bank provided much to ponder after their meeting yesterday. The euro soared against the US Dollar and Sterling. Inflation proved to be the chink in an otherwise strong European armor, partially bought about by the strength of the euro. It’s clear from Christine Lagarde's comments yesterday that the Eurozone will focus on forcing inflation higher in order to stimulate the economy and create more jobs.In the last week alone, the Great British pound has fallen almost 3% versus the euro and 5% versus the US dollar. Prime Minister Boris Johnson suggested a hard Brexit, also called a no deal Brexit, could be the inevitable outcome to the 3-year chess match that has been the Brexit negotiations. The government refused to budge on the Internal Market Bill, which, if implemented, could be breaking some fundamental laws according to the European Union. They have given Johnson to the end of the month to amend the bill or suggest the UK will face some serious legal action which isn't exactly autonomous with a smooth and orderly Brexit plan. EURGBP hasn’t traded at this level since March 25 and GBPUSD is at its lowest since July 27.Volatility across equity markets prompted another run on risk assets. Having maintained a narrow trading band through much of the domestic session, the Australian dollar found support through European trade, running past 0.73 to touch intraday highs at 0.7320, before correcting lower throughout the latter hours of the US session. A risk-off backdrop forced another sell-off across US stocks with Amazon, Apple and Google leading tech losses, while energy stocks plunged amid a drop in oil prices.
- EUR/CAD: 1.557 - 1.564 ▼
- GBP/CAD: 1.681 - 1.691 ▼
- AUD/CAD: 0.956 - 0961 ▲
- USD/CAD: 1.315 - 1.32 ▼