Forex Today: Bulls preferred greenback, oil while Loonie stood on the other end
- Return of global traders fuelled greenback and oil.
- Canadian Dollar (CAD) remained nervous ahead of the BOC.
- Australia’s CPI and the BOC are in the spotlight from economic calendar whereas Brexit may keep dominating news headlines.
With the presence of all the major global markets on the floor, Tuesday turned out as an active trading day.
Investors preferred the US Dollar (USD) and the oil among other avenues while equities also surged. However, the Canadian Dollar (CAD), generally known as the Loonie, became the biggest loser among G10 currencies.
Risk-off, previous bias on upbeat fundamentals and a welcome run of the equities could be termed as catalysts that helped the greenback became market favorite.
Brexit remained as a factor challenging market’s risk sentiment while geopolitical tensions surrounding North Korea, Iran and Libya added volume into the pessimism.
Crude oil rose to the highest since October 31 after the Organization of the Petroleum Exporting Countries (OPEC) showed concern for Iran sanctions from the US. It should also be noted that an increase in API inventories got little attention from energy traders.
The Canadian Dollar (CAD) failed to enjoy crude’s up-moves as Loonie traders remained cautious ahead of the Bank of Canada’s (BOC) monetary policy meeting later today.
Global equity traders cheered the return of major market-players as upbeat earnings from Twitter, Coca Cola and European health care stocks fuelled investor optimism. S&P 500 crossed the all-time high as it registered 0.9% gains to 2,934 whereas DJIA also secured more than half a percent gain to close around 26,656.
Despite rising equities, risk-tone remained suppressed as the US 10-year treasury yield dropped nearly two basis points to 2.57% at the end of Tuesday.
Looking forward, Australia’s first quarter inflation numbers will offer an active start to the Wednesday’s trading followed by German IFO numbers and BOC meeting. While Aussie CPI could become another reason for antipodeans to extend their recent slid, the expectedly soft outcome from German figures and the BOC might continue pushing investors towards the USD.
Key Notes:
AUD/USD remains close to 0.7100 support-line ahead of Australia inflation data
Oil Technical Analysis: WTI bulls keep the market upbeat above $66.00 a barrel
Wall Street soars to records on earnings reports
US Dollar Index Technical Analysis: DXY rolling into Asia near multi-month’s highs
Author
Anil Panchal
FXStreet
Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.
