USD/CAD Exchange rate


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Editors’ Picks

EUR/USD accelerates decline and nears 1.1200

The US Nonfarm Payroll report’s effects are long gone. The greenback gets attention as stocks eased sharply from intraday highs, still holding in the green, yet undermined by record coronavirus cases in the US.

EUR/USD News

AUD/USD hovering around 0.6920 after a dull day

AUD/USD pair seesawed between gains and losses, settling for a second consecutive day at around 0.6920. Australian PMIs and Chinese services output coming up next.

AUD/USD News

XAU/USD strengthens and rebounds from weekly lows toward $1780

Gold is trading at daily highs, near $1780 after rising $20 from the daily low. The metal dropped to $1757 after the release of the US employment report and then bounce sharply to the upside.

Gold News

Crypto collapse with Bitcoin falling below $9,000 and Ethereum getting close to $220

Most cryptocurrencies are experiencing a significant sell-off after Bitcoin fell below $9,000. BNB/USD has suffered the most with a 4% drop towards $15 and needs to hold $14.8 support. 

Read more

Oil: $40 per barrel has been broken again but there is a lack of conviction at these current levels

WTI has continued to move higher on Thursday but the price action seems pretty lacklustre despite volatility elsewhere. There have been some decent news stories in the past few sessions as it was confirmed OPEC output reached a two-decade low after over compliance from Saudi Arabia. 

Oil News

Majors

Cryptocurrencies

Signatures


USD/CAD, THE “LOONIE”

The USD/CAD tells the trader how many Canadian dollars (the quote currency) are needed to purchase one U.S. dollar (the base currency). This currency pair is known as the "Loonie", a nickname derived from the picture of a loon, a distinctive bird which appears on one side of Canada's gold-coloured, one Dollar coin.


THE IMPORTANCE OF OIL FOR THE LOONIE

The USD/CAD is one of the three so-called “commodity pairs”, together with AUD/USD, NZD/USD, highly correlated to commodity (especially oil) fluctuations.

Canada is commonly known as a resource-based economy being a large producer and supplier of oil. The leading export market for Canada is by far the United States making its currency particularly sensitive to US consumption data and economical health.


FORECAST FOR 2020

In our annual forecast, our surveyed contributors expect the USD/CAD to reach 1,3089 by the end of the year.

With the Fed on hold and projecting no change through the end of 2020 and the Canadian economy performing well, the BOC governors would need an extraordinary economic reason to re-open the interest rate discussion.

See full forecast


ASSETS THAT INFLUENCE USD/CAD THE MOST

  • Commodities: oil but also gold and natural gas are to be taken into account.
  • Currencies: JPY and EUR. This group also includes: EUR/USD, GBP/USD, USD/JPY, AUD/USD, USD/CHF, NZD/USD, GBP/JPY and EUR/JPY
  • Bonds: CSB (Canada Savings Bonds), CPB (Canada Premium Bond).
  • Indices: S&P/TSX Capped Composite Index (the headline index for the Canadian equity market), S&P/TSX Global Gold Index (index of global gold securities) and S&P/TSX Capped Energy Index (benchmarks for related derivative products of Canadian economic sectors).

ORGANIZATIONS, PEOPLE AND ECONOMIC DATA THAT INFLUENCE USD/CAD

In Canada, the organizations and people that affect the most the moves of the USD/CAD pair are:

  • Bank of Canada (BoC, Canada’s Central bank) that promotes a safe and sound financial system within tyhe country, issuing statements and deciding on the interest rates of the country. Its president is Tiff Macklem.
  • Canadian Government (headed by Justin Trudeau) and its Department of Finance that implement policies that affect the economy of the country.
  • CAPP (Canadian Association of Petroleum Producers): Canada being a prominent oil and natural gas producer, the trade organization of that industry is very important.

In the USA, we have:

  • The US Government (and its President Donald Trump): events as administration statements, new laws and regulations or fiscal policy can increase or decrease the value of the US Dollar and the currencies traded against it, in this case the Canadian Dollar.
  • Fed, the Federal Reserve of the United States whose president is Jerome Powell. The Fed controls the monetary policy, through active duties such as managing interest rates, setting the reserve requirement, and acting as a lender of last resort to the banking sector during times of bank insolvency or financial crisis.

In terms of economic data, we should highlight the Trade Account Balance, a balance between exports and imports of total goods and services. A positive value shows trade surplus, while a negative value shows trade deficit. It is an event that generates some volatility for the USD/CAD. If a steady demand in exchange for CAD exports is seen, that would turn into a positive growth in the trade balance, and that should be positive for the CAD.

Inflation is another economic value that is important for the USD/CAD pair. It is measured among others by the CPI (Consumer Price Index) and the PPI (Production Price Index). They are key indicators to measure inflation and changes in purchasing trends.