Ahead of tomorrow’s influential US advance retail sales figures and Canadian new housing price index, the Canadian Dollar rose to within range of a four-week high against its US counterpart.
The Canadian Dollar Exchange Rate was in the region of 0.9844 against the US Dollar as of 15:00 GMT
Although the currency benefited from better-than-forecast employment and housing starts data, it dipped yesterday as a result of falling commodity prices.
The ‘Loonie’ strengthened to 98.44 US cents
However, the ‘Loonie’ strengthened to 98.44 US cents and 1.0157 Canadian Dollars as investors turned to higher-risk assets as government-bond yields were at their highest for over a year.
As one macro strategist noted: ‘If you have a higher-yielding currency, then you’ll have investors moving in – so that places a bid into the Canadian currency. At the same time, the US Dollar has been hit over the past couple of weeks.’
Investor appetite for the Canadian Dollar also grew as Eurozone industrial production was shown to have expanded unexpectedly in April.
Industrial production increased by 0.4 per cent in April despite economists envisaging no change.
It was also intimated that the odds of the Bank of Canada issuing a rate increase have risen since Stephen Poloz replaced Mark Carney as Governor of the central bank.
According to Scotia Capital: ‘The Overnight Index Swap Market [is] now pricing in a 32 per cent chance of a hike in the next 12-months. These expectations have been shifting higher as expectations for the Fed to begin stepping out of [quantitative easing] have risen.’
Economists are expecting that tomorrow’s Canadian new housing-index to come in at 1.9 per cent in April, down from March’s 2 per cent.
It has been forecast that US retail sales advanced by 0.4 per cent in May, following the previous months 0.1 per cent gain.
US initial jobless claims data could also cause market volatility.
Current Canadian Dollar (CAD) Exchange Rates
< Down > Up – Little Changed
The Canadian Dollar/US Dollar Exchange Rate is currently in the region of: 0.9844 >
The Canadian Dollar /Euro Exchange Rate is currently in the region of: 0.7405 >
The Canadian Dollar/Pound Sterling Exchange Rate is currently in the region of: 0.6280 >
The Canadian Dollar/Australian Dollar Exchange Rate is currently in the region of: 1.0336 <
The Canadian Dollar /New Zealand Dollar Exchange Rate is currently in the region of: 1.2552 >
The Pound Sterling/Canadian Dollar Exchange Rate is currently in the region of: 1.5922 <
The US Dollar/ Canadian Dollar Exchange Rate is currently in the region of: 1.0157 <
The Euro/Canadian Dollar Exchange Rate is currently in the region of: 1.3504 <
The New Zealand Dollar/Canadian Dollar Exchange Rate is currently in the region of: 0.8059 >
The Australian Dollar/Canadian Dollar Exchange Rate is currently in the region of: 0.9675 >
(Correct as of 15:00 GMT)
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