- USD/CAD made lows below 1.2700.
- Rise in the price of oil helped the loonie throughout the market.
- The dollar loses strength due to a decline in Treasury bond yields.
USD/CAD extended its intraday decline in the European session and fell as low as 1.2693 in the last hour.
A combination of factors did not help the USD/CAD pair to capitalize on its first rally and caused further selling near the weekly high around the 1.2750 region. A new rise in the price of oil underpinned the loonie
On the other hand, Treasury bond yields fell after the jump experienced after the inflation data from the United States, and took strength from the dollar. The greenback still enjoys support from expectations of a faster Fed policy tightening.
Investors now seem convinced that the Fed would take a more aggressive policy stance to combat inflation and have been pricing in the possibility of a 50 bps rate hike in March. Market bets were further buoyed by more hawkish comments from St. Louis Fed President James Bullard calling for 100 basis points at the next three FOMC policy meetings.
Technical levels
Source: Fx Street
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