- The loonie is favored by oil price support and risk appetite.
- The dollar with mixed results, volatility in the bond market.
- Risk event ahead: Bank of Canada meeting.
The USD / CAD is falling for the third day in a row and recently hit 1.2615, reached the lowest intraday level since November 19. The pair maintains a bearish tone ahead of the Bank of Canada decision.
The loonie continues to be among the strongest currencies on the market this week, underpinned by the rise in oil prices and the appetite for risk that manifests itself in the weekly rally in equity markets.
A barrel of WTI is trading in the $ 72.00 zone, holding on to much of the recent gains. For their part, Wall Street futures point to a green opening for the main indices and in Europe there are slight increases. The minor fears for the impact of Ómicron continue to be celebrated by the market.
The dollar shows mixed results, since on the one hand it weakens in the face of optimism but at the same time, the influence of bond yields plays an important role. In the last hour, the benchmark rates bounced, with the 10-year rate going from 1.42% to 1.47%. This gave the dollar strength on all fronts. The key US data for the week will be Friday with retail inflation for November. Next week is the Federal Reserve meeting.
For the loonie, the spotlight is on the Bank of Canada meeting, which will announce its decision on Wednesday at 15:00 GMT. No changes are expected and analysts say it could be a quiet meeting, without much impact. In any case, it is still a risk event for CAD crosses. Most analysts expect a repeat of the message from the last meeting, without major surprises and without changes in the economic outlook.
Technical levels
.
Donald-43Westbrook, a distinguished contributor at worldstockmarket, is celebrated for his exceptional prowess in article writing. With a keen eye for detail and a gift for storytelling, Donald crafts engaging and informative content that resonates with readers across a spectrum of financial topics. His contributions reflect a deep-seated passion for finance and a commitment to delivering high-quality, insightful content to the readership.