USD/CAD extends losses near 1.3650 on surging oil prices, tension in Middle East – Crypto News – Crypto News
Connect with us
Low/mid 1.29s to hold as loonie finds it difficult to gain ground – Scotiabank Low/mid 1.29s to hold as loonie finds it difficult to gain ground – Scotiabank

others

USD/CAD extends losses near 1.3650 on surging oil prices, tension in Middle East – Crypto News

Published

3 years ago

on

Share:

  • USD/CAD extends losses due to higher WTI oil prices, coupled with bumper Canada’s employment data.
  • The Palestine-Israel conflict could contribute support for the oil prices.
  • Upbeat US Nonfarm Payrolls provided support to underpin the US Dollar (USD).

USD/CAD continues the losing streak for the third successive session, trading lower around 1.3650 during the early Asian session on Monday. The pair is facing challenges due to a sharp rise in oil prices, which could be attributed to the Palestine-Israel military conflict.

The conflict may have sparked a new surge in oil prices. The heightened geopolitical tensions could affect the Canadian Dollar (CAD), especially since Canada is the largest oil exporter to the United States (US).

Western Texas Intermediate (WTI) oil price extends its gains on the second day, trading higher around $85.80 per barrel, at the time of writing.

Additionally, the bumper data from Canada might have supported the Loonie Dollar, Net Change in Employment in September printed the higher readings of 63.8K than 20.0K expected, which was 39.9K figures in August. Moreover, the Unemployment Rate for the said month remained consistent at 5.5% compared to the market consensus of 5.6%.

The markets are closely monitoring the rekindled military conflict in the Middle East involving Palestine and Israel. The concern is that this conflict has the potential to escalate and spread to other parts of the region, introducing geopolitical uncertainties that could impact global markets.

The US Dollar Index (DXY) has bounced back after three consecutive days of losses, trading around 106.20, by the press time. The strength in the US Dollar (USD) can be attributed to the impressive US Nonfarm Payrolls data unveiled on Friday.

The jobs report for September revealed a notable increase of 336,000 jobs, surpassing the market expectation of 170,000. The revised figure for August stood at 227,000. However, US Average Hourly Earnings (MoM) remained steady at 0.2% in September, falling short of the expected 0.3%. On an annual basis, the report indicated a rise of 4.2%, below the anticipated consistent figure of 4.3%.

US Treasury yields have also rebounded, driven by expectations of the Federal Reserve (Fed) maintaining higher interest rates for an extended period. As of now, the 10-year US Treasury bond yield has once again stood at 4.80% near its peak since 2007.

Investors will likely monitor the upcoming International Monetary Fund (IMF) meeting, which is set to deliberate on strategies for stabilizing international exchange rates and fostering development.

Additionally, attention will be focused on the US Core Producer Price Index later in the week, as it plays a crucial role in gauging inflationary trends and economic conditions in the United States.

 

Related Topics:
Continue Reading
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Trending