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CAD struggles against USD

Thursday 15 July, 2021

Daily Currency Update

CAD - Canadian DollarThe Canadian dollar struggled against the dollar as market participants continued to digest Wednesday’s Bank of Canada policy statement and US Federal Reserve chair Jerome Powell’s testimony to Congress. USDCAD was up 0.25%, trading at 1.2542 at the time of writing.The BOC opted to leave rates on hold at 0.25% and taper bond purchases by 1 billion per week as expected; however, it failed to expand on forward guidance and presented a somewhat dovish overview of the recovery. The CAD fell half a percent overnight, a move compounded by a fall in oil prices.

Key Movers

Those looking for a stronger GBP were left disappointed this morning following the release of mixed labor market statistics for June. UK wage pressures continue to rise and beat analyst expectations, however the rate of unemployment ticked slightly higher. The UK’s official jobless rate rose to 4.8% in June vs the previous 4.7%. Demand for the pound fell following the mixed data before edging back up against the dollar. GBPUSD was up 0.06% at 1.3865 at the time of writing.The US dollar was little changed this morning after weakening against most of the major currencies on Wednesday. The US Dollar Index was up 0.15%, trading at 92.55 at the time of writing. US Federal Reserve Chairman Powell admitted that inflation data has been higher than expected, and they lack certainty on transitory inflation even though they believe that to be the case. The central bank sees the next six months as critical for US inflation, to see if it falls back as they expect. Should the inflation rate remain high, this could mount more pressure on the Fed to bring forward rate hikes which can be positive for the dollar. The Australian dollar fell against the US dollar following mixed employment data and continued concerns over growing COVID-19 cases. AUDUSD was down 0.53%, trading at 0.74410 at the time of writing.

Expected Ranges

  • EUR/CAD: 1.4781 - 1.4845 ▲
  • GBP/CAD: 1.7306 - 1.7397 ▲
  • AUD/CAD: 0.9327 - 0.9375 ▼
  • USD/CAD: 1.2497 - 1.2561 ▲