- USD / CAD is trading near 1.2500 as the selloff in the crude oil markets slows.
- Canadian retail sales were stronger than expected, but have not had a lasting impact on the loonie.
The USD / CAD it is trading modestly bullish for the day just above 1.2500, but has fallen back from the previous session’s highs at 1.2545. Currently, the pair is trading higher by about 20 pips or just under 0.2%.
Performance of the day
The loonie was hit hard on Thursday along with a sharp drop in crude prices. With crude oil prices much more stable and even rising a bit (WTI is back above $ 60.00 and approaching $ 61.00), the decline in the Canadian dollar is slowing down a bit.
Elsewhere, aside from crude oil price action and a stronger-than-anticipated Canadian retail sales report for the month of January, there hasn’t been much else to note for USD / CAD; the US dollar experienced a fleeting strength following the Fed’s decision not to extend the supplemental leverage ratio (SLR) rules from the pandemic era to the end of the month; These rules had allowed banks to keep US Treasuries and deposits on their balance sheets exempt from normal capital ratio requirements, a ruling the Fed decided in the early stages of the Covid-19 crisis order to curb selling pressure. excessive in the US Treasury markets SLR rules will expire at the end of the month.
USD / CAD briefly rose to 1.2540 on this news, the market shock has not been long-lasting, and a recent article by Fed Chairman Jerome Powell published in the WSJ contained no new information on the policy direction. of the Fed or the outlook on the economy and therefore did not move the markets at all. Things are going to be quiet for loonie traders next week, with only comments from Bank of Canada Deputy Governor Toni Gravelle to keep an eye on, while USD traders will have to watch out for a large dose of speeches from the Fed (including Fed Chairman Powell, as well as preliminary PMI data from Markit and core inflation from PCE.
Technical levels
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