Kenny Fisher | Aug 24, 2018 09:41
The Canadian dollar is steady in the Friday session, after recording sharp losses on Thursday. In North American trade, USD/CAD is trading at 1.3066, down 0.11% on the day. On the release front, investors are braced for mixed results from durable goods reports for July. Core durable goods are forecast to rise to 0.5%, while durable goods are expected to downturn, with an estimate of -0.7%. Investors will be listening closely as Federal Reserve Chair Jerome Powell speaks at the economic symposium at Jackson Hole. There are no Canadian events on the schedule.
The Canadian currency has shown significant volatility this week and dropped 0.62% on Thursday. The decline was in response to another wave of tariffs between the U.S. and China, which took effect on Thursday. The tariffs, valued at $16 billion, kicked in despite the fact that the parties were holding low-level trade talks at the same time. As expected, the talks did not yield any breakthrough. The escalation in trade sanctions is bad news for the export-reliant Canadian economy and is also weighing on investor risk appetite for minor currencies like the Canadian dollar. If the U.S. slaps further tariffs on its trading partners, the Canadian dollar will be sailing into significant headwinds.
The Federal Reserve released the minutes of its July meeting, at which policy-makers maintained the benchmark rate. The minutes noted that the U.S economy remains strong and hinted that the Fed would raise rates in September. However, policy-makers added that the plan to continue with gradual rate increases could have to be halted if the global trade war worsens, as the trade war represents a major downside risk to the U.S. economy. Fed Chair Jerome Powell will address the Jackson Hole Symposium on Friday, and investors will be listening carefully. Powell is expected to refer to trade tensions, as well as the fact that inflation and wage growth have lagged, despite a booming U.S. economy. The minutes have cemented a rate hike in September, with market odds currently at 98%. The likelihood of a December rate hike stands at 57%.
USD/CAD Fundamentals
Friday (August 24)
*All release times are DST
*Key events are in bold
USD/CAD for Friday, August 24, 2018
USD/CAD, August 24 at 6:55 DST
Open: 1.3081 High: 1.3104 Low: 1.3066 Close: 1.3066
USD/CAD Technical
S3 | S2 | S1 | R1 | R2 | R3 |
1.2733 | 12831 | 1.2970 | 1.3067 | 1.3160 | 1.3292 |
In the Asian session, USD/CAD inched higher but retracted. The pair has posted small losses in North American trade
Further levels in both directions:
This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.