USD/CAD retraces its recent losses, hovers around 1.3700 – Crypto News – Crypto News
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USD/CAD retraces its recent losses, hovers around 1.3700 – Crypto News

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  • USD/CAD trades higher post losses registered in the previous session.
  • Canada inflation (YoY) fell to 3.1% in October, down from 3.8% prior.
  • The decline in Crude oil prices could weigh on the CAD.
  • US Dollar faces challenges despite improved US bond yields.

USD/CAD recovers its intraday losses, hovering around the psychological level of 1.3700 during the Asian session on Wednesday. The USD/CAD posted losses despite the downbeat Canada inflation data released on Tuesday, which might be enough to keep the Bank of Canada (BoC) on hold now.

The Consumer Price Index (CPI) fell to 3.1% year on year in October, down from 3.8% in September. This number was lower than the market’s forecast of 3.2%. The CPI grew 0.1% monthly, as expected. Furthermore, the monthly Core CPI increased by 0.3%, but the annual Core CPI fell to 2.7% from 2.8%.

According to Statistics Canada’s press release, “the year-over-year deceleration was largely a result of lower gasoline prices (-7.8%) in October.” “Excluding gasoline, the CPI rose 3.6% in October, following a 3.7% increase in September.”

The Canadian dollar (CAD) may encounter downward pressure as crude oil prices fall. Western Texas Intermediate (WTI) has ended a three-day gaining streak, trading lower near $77.70 per barrel at the time of publication. Crude oil prices are moderately declining as a potentially substantial increase in US crude oil stocks develops.

API Weekly Crude Oil Stock increased by 9.047 million barrels from the previous week’s total of 1.335 million barrels in the week ended November 17. Higher US crude oil reserves offset benefits from the Organization of Petroleum Exporting Countries (OPEC) and other suppliers’ planned supply limitations.

According to the FOMC meeting minutes, members would consider tightening monetary policy further if “incoming information indicated that progress towards the Committee’s inflation objective was insufficient.” Policymakers also agreed that policy should remain restrictive for some time until inflation is clearly and sustainably going down towards the Committee’s target.

The US Dollar Index (DXY) struggles to extend gains, hovering around 103.50 at the time of writing. The US Dollar (USD) faces challenges despite improved US Treasury rates on Wednesday. The 10-year and 2-year US bond rates increased to 4.41% and 4.88%, respectively, by the press time.

Investors await data from the United States (US), which is scheduled on Wednesday, including weekly jobless claims and the Michigan Consumer Sentiment survey. On the agenda for Canada is a speech by BoC Governor Tiff Macklem at the Saint John Region Chamber of Commerce.

 

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