The Fed’s shock decision to refrain from committing to the highly anticipated taper of bond purchases threw the currency market into a bit of a spin yesterday, with assets like the Canadian Dollar advancing on safe-haven rivals like the US Dollar and Yen.
The commodity-driven currency also strengthened against the Pound, and went on to consolidate gains during the European session.
The Canadian Dollar Exchange Rate was in the region of 0.6098 against the British Pound as of 14:10 GMT
Prior to tomorrow’s release of Canadian inflation figures the ‘Loonie’ was trading in the region of a three-month high against its US rival after busting through its 200-day moving average for a second day.
Currency strategist Jeremy Stretch had this to say of the Canadian Dollar’s surge; ‘After the moves we’ve seen in the last 24 hours, there’s always a little bit of scope for a pause for breath. It’s probably a good opportunity to take a little bit of profit and pause for breath as markets recalibrate after the Fed surprise’.
Meanwhile, disappointing UK retail sales saw the ‘Loonie’ rally against its British peer. The retail sales report was the first piece of UK data not to surprise to the upside for several weeks, so the unexpected decline of 0.1 per cent in August month-on-month came as a bit of a blow to the Pound.
The CAD/GBP exchange rate hit a high of 0.6094
‘Loonie’ gains were extended as domestic wholesale sales were shown to have surged in July.
Following a hefty 3.1 per cent decline in June wholesale sales climbed by 1.5 per cent in July.
Economists were anticipating a gain of 1.2 per cent.
The larger-than-forecast gain was largely due to a 3.2 per cent advance in machinery and equipment, although over half of the subgroups included in the measure reported increases.
Yesterday’s comments from Bank of Canada Governor Stephen Poloz also benefited the Canadian Dollar.
During a speech in Vancouver Poloz remarked that improving global demand is helping business investment take over from consumer spending in driving growth, with the consequence that Canada’s economy will expand more without adversely affecting inflation.
Tomorrow’s Canadian inflation figures, due out at 13:30 GMT are likely to be the main driver of ‘Loonie’ movement before the weekend.
Current Canadian Dollar (CAD) Exchange Rates:
< Down > Up
The Canadian Dollar/US Dollar Exchange Rate is currently in the region of: 0.9795 >
The Canadian Dollar /Euro Exchange Rate is currently in the region of: 0.7231 <
The Canadian Dollar/Pound Sterling Exchange Rate is currently in the region of: 0.6098 >
The Canadian Dollar/Australian Dollar Exchange Rate is currently in the region of: 1.0317 >
The Canadian Dollar /New Zealand Dollar Exchange Rate is currently in the region of: 1.1660 <
The Pound Sterling/Canadian Dollar Exchange Rate is currently in the region of: 1.6409 <
The US Dollar/ Canadian Dollar Exchange Rate is currently in the region of: 1.0210 <
The Euro/Canadian Dollar Exchange Rate is currently in the region of: 1.3828 >
The New Zealand Dollar/Canadian Dollar Exchange Rate is currently in the region of: 0.8575 >
The Australian Dollar/Canadian Dollar Exchange Rate is currently in the region of: 0.9693 <
(Correct as of 14:10 GMT)
Comments are closed.