The Greenback continues to fall against G10 currencies, this time driven by a bullish Euro bias and the European summit this weekend.

Key Movers

Sophisticated FX instruments such as “option derivatives” are showing that the Euro euphoria is here to stay. However, these derivatives are showing a “wait and see” setup for this weekend, which means that there are no big bets on the Euro’s direction. A breakthrough at the summit over the region’s recovery fund should push the Euro higher versus G10 currencies, or a complete breakdown of talks could deeply hurt the bullish bias of the Euro.The Canadian dollar is falling this morning against the Euro, US dollar, and Aussie dollar following weaker than expected wholesale trade sales. It came in at 5.7% versus the 7.9% expected. Two days ago, Bank of Canada (BoC) Governor Tiff Macklem pledged not to raise rates, “...until economic slack is absorbed,” and reiterated the BoC’s commitment to keep buying government securities. However, negative sentiment continues following the BoC’s policy statement and Wednesday’s Monetary Policy Report, which said, "...we are facing many uncertainties, the biggest of which is the unknowable course of the virus itself. As a result, we cannot forecast with the usual degree of accuracy in our economic projections." It is known that market participants hate uncertainty, which usually makes them pessimistic about their outlook, in this case the Loonie’s outlook.