Canadian Dollar twists as markets struggle to pick a direction
Daily Currency Update
The Canadian Dollar (CAD) tumbled against the Greenback early Monday before a mid-session recovery. The CAD is holding in positive territory against the US Dollar to kick off the new trading week, but market flows remain thin with Canadian markets shuttered for the August Civic Holiday.CAD traders will be waiting in the wings with meaningful Canadian economic data slated for Friday with July’s updated labor figures. A smattering of mid-tier data from Canada is due throughout the midweek, but impact is set to be limited.
Key Movers
Oil prices (WTI) down 0.32% to 72.71 and US$6.4 trillion stock wipeout has traders fearing ‘great unwind’ is just starting.On Monday, the global flight from riskier assets intensified dramatically as concerns grew that the US may be on the brink of a recession, rattling investors and shaking financial markets. This heightened uncertainty had a significant impact on the US dollar, which initially saw a surge in value as investors sought safety in the currency.
US central bank policymakers quickly intervened, pushing back against fears that weaker-than-expected July job data signaled an impending recession. They cautioned that while the economy isn’t in freefall, the Federal Reserve may still need to cut interest rates to prevent a downturn. Such a move could weaken the dollar in the long term, as lower rates typically reduce the currency’s appeal to investors.
Expected Ranges
- EUR/CAD: 1.50742 - 1.51427 ▼
- GBP/CAD: 1.75279 - 1.76629 ▼
- AUD/CAD: 0.89593 - 0.90247 ▼
- USD/CAD: 1.37932 - 1.3856 ▲