Tradervox.com (Dublin) – The Federal Open Market Committee meeting minutes released yesterday showed that some policy makers supported the expansion of stimulus but the committee chose to substitute this with the expansion of the Operation Twist program. This has led the Canadian dollar to increase significantly against the US dollar as the market opened. Currency had pared its gains after the stocks fell on as investor construed the minutes to mean the US central bank did not do enough to bolster the US economy. The Canadian dollar increased together with other commodity related currencies such as the Australian Dollar and the New Zealand dollar. Loonie’s advanced was also limited as reports from Statistics Canada showed that May merchandise trade deficit was greater than projected by the market.
John Curran, a Canadian Forex ltd Vice President, said that people are taking risk off as they turn around, some buying the loonie against some currencies while others are selling the loonie against other currencies hence making the USD/CAD outlook vague. The Canadian dollar also rose as the Standard & Poor’s 500 Index remained unchanged after falling by 0.6 percent; the Thomson Reuters/Jefferies CRB Index showed an increase of 0.7 percent.
Further, the minimal advance by the loonie came as the Bank of Canada sold $3.3 billion worth of five-year notes at a yield of 1.24 percent which is lower than the previous sale on May 9 of 1.53 percent. Some currency strategists such as Firas Askari of bank of Montreal noted that this is a tight summer and the market might not be a volatile as it should be. There are also economists who have indicated that the Canadian government bonds will have weaker yields as the US economy continues to weaken.
The Canadian dollar appreciated by 0.3 percent against the greenback to trade at C$1.0198 at the close of trading yesterday.
John Curran, a Canadian Forex ltd Vice President, said that people are taking risk off as they turn around, some buying the loonie against some currencies while others are selling the loonie against other currencies hence making the USD/CAD outlook vague. The Canadian dollar also rose as the Standard & Poor’s 500 Index remained unchanged after falling by 0.6 percent; the Thomson Reuters/Jefferies CRB Index showed an increase of 0.7 percent.
Further, the minimal advance by the loonie came as the Bank of Canada sold $3.3 billion worth of five-year notes at a yield of 1.24 percent which is lower than the previous sale on May 9 of 1.53 percent. Some currency strategists such as Firas Askari of bank of Montreal noted that this is a tight summer and the market might not be a volatile as it should be. There are also economists who have indicated that the Canadian government bonds will have weaker yields as the US economy continues to weaken.
The Canadian dollar appreciated by 0.3 percent against the greenback to trade at C$1.0198 at the close of trading yesterday.
