USD/CAD: Loonie's weakness above 1.21 to gain traction – DBS Bank

FXStreet Insights Team FXStreet

Economists at DBS Bank note that CAD weakness above 1.21 per USD gains traction. USD/CAD is set to challenge the 1.22 level above which lies the 1.2250 50-day moving average.

Falling lumber prices weigh on the loonie

“The Bank of Canada, at its meeting last Thursday, did not exhibit any urgency to follow through on April’s decision to taper bond purchases. CAD is also weighed by lumber prices which have sunk more than 40% over the past month to below USD1,000 per thousand board feet for the first time since 30 March.”

“Having traded above its 20-day moving average around 1.2090, USD/CAD could next test its 1.22 high seen a month ago towards its next major resistance around 1.2250 or its 50-day moving average.”

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

GBP/USD recovers to 1.3450 region, looks to post weekly gains

EUR/USD stays below 1.1450 after US data

Gold rebounds from July lows, struggles to reclaim $4,000

CLARITY Act approval odds sink fast ahead of Congressional hearing

The United States (US) House Financial Services Committee’s Subcommittee on Digital Assets, Financial Technology, and Artificial Intelligence (AI) is holding a hearing titled “Building the Future of Finance: How the CLARITY Act Unlocks Innovation” on Friday.

Week ahead – Could technology earnings revive equities as geopolitical risks linger?

Oil prices rise, but the dollar posts losses as Middle East tensions persist. US earnings, the ECB and UK newsflow dominate next week’s agenda. US equity markets face a pivotal test as focus shifts to technology earnings.

-0.4%: Why the biggest CPI drop since 2020 couldn't buy back a single cut

The June CPI fell 0.4% on the month, the largest one-month decline since April 2020, dragging the annual rate to 3.5% from May's 4.2% and snapping a three-month acceleration streak. Core prices went nowhere, flat on the month and down to 2.6% YoY, both under consensus.