USD/CAD Demonstrates Bearish Trend Ahead of FOMC Rate Decision

The USD/CAD currency pair today traded with a bearish trend despite the release of positive Consumer Price Index data and advance retail sales data from the US docket. The Canadian dollar’s rally was largely sustained by the higher crude oil prices in the global commodities market with the WTI crude oil gaining at least 1.5% earlier today.

The currency pair was on a bearish trend from the start of the day’s session and had lost over 20 points at the time of writing. This can be largely attributed to the underperforming US dollar as evidenced by the US Dollar Index, which was trading at a low of 101.47 having opened the day’s session trading at 101.71.

The greenback was performing poorly during today’s session despite the release of positive Consumer Price Index data by the Bureau of Labor Statistics, which met expectations at an annualized figure of 2.7%. The advance retail sales data also met expectations at 0.1%, but the positive economic data did little to boost the greenback.

The currency pair was also affected by the stronger loonie, a commodity-backed currency, given the higher crude oil prices. The currency pair was also affected by the poor long-term yields of US bonds as compared to the higher short-term yields.

The currency pair’s performance is likely to be affected by the US FOMC rate decision scheduled for 18:00 GMT.

The USD/CAD was trading at 1.3455 as at 16:47 GMT having recovered from a low of 1.3430 earlier today. The USD/JPY was trading at 114.59 having hit a high of 114.87 earlier today.

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