The Canadian Dollar to US Dollar (CAD/USD) exchange rate is trending within a tight range on Monday. This can be attributed to positive data boosting the ‘Loonie’ (CAD), and Federal Reserve policy divergence supporting the US Dollar.
The Canadian Dollar to US Dollar exchange rate is currently trending in the region of 0.8733.
Canadian Dollar (CAD) Exchange Rate Strengthens on Housing Data
Although Monday’s duo of Canadian economic data publications produced mixed results, the ‘Loonie’ strengthened against the majority of its currency rivals. Monthly Building Permits was forecast to drop from 12.5% to 3.9%, but the actual result saw only 0.7% growth in October. Housing Starts, however, increased beyond the median market forecast of a rise from 183,700 to 195,000, with the actual result reaching 195,600.
The Canadian Dollar to US Dollar exchange rate has dropped to a low today of 0.8722.
US Dollar (USD) Exchange Rate Gains on Policy Divergence
US economic data has printed reasonably negatively on Monday. Labour Market Conditions Index Change declined from 4 to 2.9. However, the US Dollar has strengthened against nearly all of its most traded competitors as a result of policy divergence between that of the Federal Reserve and other major central banks.
‘The markets seem to have bought into this idea that no matter what the economic data is, the Fed goes late in 2015,’ said Neil Dutta, head of U.S. economics at Renaissance Macro Research in New York.
Canadian Dollar to US Dollar (CAD/USD) Exchange Rate Forecast to Soften
With the US Dollar continuing to trend on a bullish run irrespective of domestic data results, the Canadian Dollar to US Dollar exchange rate is likely to trend lower. Tuesday’s US Small Business Optimism has the potential to provoke volatility.
The Canadian Dollar to US Dollar exchange rate has climbed to a high today of 0.8749.
