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- The US dollar/CAD attracts some buyers for the second consecutive day amid a set of supportive factors.
- Low oil prices, domestic political uncertainty, and annual functionality data on Friday undermine LONIE.
- The risk mood is beneficial to the relative security situation of the US dollar, and also acts as the back wind of the husband.
Dollar pair/cad Some purchase attracts follow-up for the second consecutive day on Monday and looks forward to building a modest recovery last week from a region of 1.4030-1.4025 or the lowest level in its history. Immediate prices are currently trading around mid -1.4200, an increase of approximately 0.25 % for the day, although the bulls may wait for a continuous force that exceeds the simple moving average for 100 days before laying fresh mixed significance.
Crude oil prices He declined to the lowest level of four years, amid increasing concerns that the mutual definitions committed by US President Donald Trump will lead to a comprehensive global trade war and weaken the demand for fuel. Moreover, eight OPEC+ members have developed their plan unexpectedly to gradually get rid of discounts in production, which sparked over compensation interests and overweight over the black liquid. Regardless of this, the political uncertainty before the Canadian elections on April 28, along with the disappointing local recruitment data on Friday, undermines the LONIE associated with the commodity and works as a note for a USD/CAD husband.
Meanwhile, the risk of trade tensions in the United States and Canada in the United States indicates that a less resistant path for the currency pair is the upper direction. In fact, Canadian Prime Minister Mark Carney said on Thursday that the previously announced revenues will remain valid and that Canada will impose a 25 % tariff on all vehicles imported from the United States that are not compatible with the USMCA trade deal. This, in addition to the emergence of some of the US dollar (the US dollar) after the decline in the Asian session, it was found that another factor provides additional support to the USD/CAD husband.
The US dollar maintains modest recovery gain Non -agricultural salary statements (NFP) report and Federal Reserve (Federal Reserve) President Jerome Powell Falcons. In addition, the prevailing risk environment is believed to benefit from the relative security situation in Greenback. However, any meaningful appreciation in US dollars remains a long time following the stakes that the American economic slowdown by the customs tariff may force the Federal Reserve to resume the price cutting course soon. This, in turn, may maintain a cover on the pair of the dollar/CAD, which calls for caution to the bulls.
Questions and answers in Canadian dollars
The main factors that lead the Canadian dollar (CAD) are the level of interest rates set by the Bank of Canada (BOC), the price of oil, the largest export in Canada, the health of its economy, inflation and commercial balance, which is the difference between the value of exports in Canada in exchange for its imports. Other factors include market morale-if investors are eating more risky assets (risk) or searching for safe materials (risk)-with positive CAD risks. As its largest commercial partner, the health of the American economy is also a major factor that affects the Canadian dollar.
Canada Bank (BOC) has a major impact on the Canadian dollar by determining the level of interest rates that banks can persuade each other. This affects the level of interest rates for everyone. The main goal of BOC is to keep inflation by 1-3 % by setting interest rates up or down. Relatively higher interest rates tend to be positive for CAD. Canada Bank can also use quantitative dilution and tighten it to influence credit conditions, with previous CAD negative and the other positive CAD.
The price of oil is a major factor that affects the value of the Canadian dollar. Petroleum is the largest export in Canada, so the price of oil tends to an immediate effect on the CAD value. In general, if the price of oil rises, the CAD rises, with the increased total demand for the currency. The opposite is the case if the price of oil decreases. The high oil prices also tend to increase the possibility of a positive commercial balance, which also supports CAD.
While inflation was always believed to be a negative factor of the currency because it reduces the value of money, the opposite was already the case in the modern era with the relaxation of capitalist controls across the border. Top inflation tends to lead the central banks to raise interest rates that attract more capital flows from global investors looking for a profitable place to keep their money. This increases the demand for the local currency, which in the case of Canada is the Canadian dollar.
Victory of macroeconomic data evaluates the health of the economy and can have an impact on the Canadian dollar. Indicators such as GDP, manufacturing, PMIS, employment services, and consumer morale surveys can affect CAD direction. The strong economy is useful for the Canadian dollar. Not only attracts more foreign investments, but it may encourage Canada Bank to set interest rates, which leads to a stronger currency. If economic data is weak, CAD is likely to fall.
