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A combination of factors prompted some follow-through selling around USD/CAD.

The risk-on mood continued weighing on the safe-haven USD and exerted downward pressure.

Rallying crude oil prices underpinned the loonie and further contributed to the offered tone.

The USD/CAD pair remained depressed through the week and was last seen trading around the 1.2650 region, just above multi-week lows.

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The pair edged lower on the first day of a new trading week and extended Friday's intraday fall of around 85-90 pips from the 1.2765 area. The downtick was sponsored by a combination of factors, though lacked any strong follow-through and the USD/CAD pair, so far, has managed to hold above multi-week lows support around the 1.2660 region.

The progress in the coronavirus vaccinations and hopes for a massive US fiscal stimulus plan has been fueling the optimism about a strong global economic recovery. This, in turn, remained supportive of the underlying bullish sentiment as depicted by the continuation of a rally in the equity markets  and dented the US dollar's safe-haven status.

A strong pickup in crude oil prices underpinned the commodity-linked loonie and exerted some pressure on the USD/CAD pair. Oil prices remained well supported by hopes that easing of lockdown restrictions will lift the global fuel demand and got an additional boost from rising fears of heightened tensions in the Middle East.


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