- Loonie weakens the end of Trump’s tariff fears, the uncertainty in the BOC rate
- The dollar/CAD remains firm over 1.4200, raising the risk of the risks of the US dollar.
- The high inflation in Canada may delay BOC relief, adding uncertainty.
- Traders are waiting for FOMC minutes for FOMC on the time of the interest rate.
The Canadian dollar (CAD) will fall against the US dollar on Wednesday, with the US dollar’s pair/CAD remaining on its feet over the handle of 1.4200 amid renewed fears of US President Donald Trump’s threats. Leave the lack of Canadian data circulating on the economic list in the United States (the United States), especially the housing data for January.
The Canadian economic list was empty, but the last round of inflation data witnessed an increase, indicating that the Bank of Canada (BOC) may rethink twice before reducing policy. In the United States, housing in January begins disappointed by investors, although construction permits showed that construction continued to increase the edge, despite the frequency of anemia.
today American economic list It will also show the issuance of the latest Federal Reserve Monetary Policy Meet (Fed). On January 27-28, the Federal Reserve decided to keep it Rates A company, stops the mitigation course with steam inflation collection. It must be said that the federal reserve Jerome Powell She turned into a little honesty, saying they are not in a hurry to reduce interest rates.
Since then, most federal reserve officials have turned into a little caution, and to adopt a waiting and vision mode regarding inflation.
Daily Digest Market Movers: Canadian Dollaar Congrggs to Rally amid mixed American data
- The beginnings of American housing decreased 9.6 % in January, as it fell from 1.515 million to 1.366 million, as harmful weather conditions affected construction activity.
- On the other hand, American construction permits rose slightly up, as it increased by 0.1 % from 1.482 million to 1.483 million during the same period, indicating flexibility in future construction plans.
- The interest rate teams between Canada and the United States continued to influence LONIE, which remained compressed for the third consecutive day. The US dollar/CAD reached the highest weekly level of 1.4244.
- However, the reflection is looming on the horizon because BOC may keep verification rates after the release of the consumer price index data in January. In that result, the US dollar/CAD may aim to decrease as the Canadian dollar is estimated at Greenback.
The US dollar/dollar price expectations: More Canadian dollar is to be estimated, despite publishing losses
Uptrend USD/CAD Steam was lost after its peak near 1.4800. Since then, the sellers have taken over, which prompted prices to less than the simple moving average for 50 days (SMA) at 1.4338 and cleansing the lowest daily level on January 20 of 1.4260, a decisive level for buyers. The downside increases the front if the bears pay the price of the comma to less than 100 days SMA at 1.4111.
Otherwise, if the buyers are raised USD/CAD After 1.4300, they should restore SMA for 50 days to stay in the hope of the highest prices.
Questions and answers in Canadian dollars
The main factors that pay the Canadian dollar (CAD) are the level of interest rates set by Canada Bank (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 Canada’s exports 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.
2025-02-19 18:38:57