Investments
USD/CAD drops to near 1.3720 as hopes of resumption of BoC policy-tightening deepen
- USD/CAD has slipped firmly to near 1.3720 amid subdued US Dollar and upbeat Canadian Retail Sales data.
- Higher Canadian Retail Sales have raised hopes for a resumption of a policy-tightening spell by the BOC.
- Oil price is eyeing more upside as Russia can attract more sanctions.
The USD/CAD pair has printed a fresh day low at 1.3725 in the Asian session. The downside move in the Loonie asset is backed by a subdued performance from the US Dollar Index (DXY) and rising hopes for a resumption of a policy-tightening spell by the Bank of Canada (BoC) after the release of robust Canadian Retail Sales data.
S&P500 futures have generated solid gains in the Asian session as the consideration of expanding the emergency lending program by US authorities has infused confidence among the market participants. The US Dollar Index (DXY) is struggling to find strength as the street is cheering the expectations of termination in the policy-tightening spell by the Federal Reserve (Fed). The USD Index is defending the 103.00 support, however, the downside looks favored.
Expectations for a halt in the rate-hiking spell by the Fed are deepening amid rising credit tightening conditions by US banks after turmoil. Banks are having more precautions while disbursing advances. It looks like financial institutions have heavily faced the consequences of a blood fight against stubborn inflation.
On the Canadian Dollar front, upbeat Retail Sales (Feb) data has bolstered the odds of a resumption of the policy-tightening spree by the Bank of Canada (BoC). The year started with the announcement of a halt in rate hikes by the BoC as it considered the current monetary policy restrictive enough to contain inflation.
Monthly Canadian Retail Sales (Feb) jumped to 1.4%, higher than the consensus of 0.7%, and a flat performance observed earlier. Robust demand by Canadian households might force firms to hike prices for goods and services offered, which could propel the need for further rate hikes by the BoC.
On the oil front, the oil price is juggling in a narrow range above $69.00. The black gold is gathering strength for extending the upside as Russia can attract more sanctions. Russian President Vladimir Putin has conveyed his intensions to planning stations for tactical nuclear weapons in Belarus.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Subscribe to our weekly newsletter below and never miss the latest NEWS or an exclusive offer.
