News & Analysis
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WTI has reversed losses sustained earlier on in the week as OPEC announced that it sees the potential for a cut in supply from non-OPEC producers next year.
The loonie traded flat yesterday as oil traded lower. The moves are all minor in a wider scope, and USDCAD continues to trade higher this morning.
Sterling rose sharply yesterday after Nigel Farage announced the Brexit Party would not be contesting Conservative Party seats won in 2017.
The loonie also lost out to the greenback last week, but less so in the early stages compared to its G10 counterparts as oil markets also rallied on positive US-China trade headlines.
The same cannot be said for today as WTI reversed all of yesterday’s gains following signals that Saudi Arabia will increase production by 150,000 barrels per day to meet pre-existing contracts with Chinese investors.
The loonie has joined the risk rally this morning following news that the US and China will begin to lower tariffs in stages beginning with the phase one trade deal.
It was much of the same for the loonie yesterday as it continued to weather the storm of broad USD strength, ranking only second to the Australian dollar which was helped by a net hawkish RBA.
The loonie was put on the back foot yesterday but fared better than other G10 currencies as the improvement in risk sentiment spurred on crude prices which helped CAD against a strengthening US dollar.
The loonie managed to regain some of Wednesday’s losses from a dovish Bank of Canada over the course of Thursday and Friday, but is trading marginally weaker this morning against the US dollar.
The loonie has become somewhat subdued following the Bank of Canada meeting and failed to capitalise on broad USD weakness yesterday.