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CAD Improves on Oil and USD Weakness

Published January 12, 2017
  • The US dollar fell to one month lows after President-Elect Donald Trump’s press conference yesterday failed to mention any specific details on his plans for new economic and fiscal initiatives; US Dollar Index is at its weakest level since December 14, 2016
  • European markets showed weaker performance and US stock futures are lower as healthcare stocks dropped after Trump heavily criticized and promised swift reform for the pharmaceutical industry
  • A lack of detail on tariffs in Trump's news conference boosted Asian export-oriented and emerging markets such as South Korea and Chinese yuan, while Russian stocks were supported by Trump's defence of better ties with Moscow, also gained from higher oil prices
  • CAD is one of the best performing G10 currencies this morning as the Canadian Dollar is at its strongest level against the USD since mid-October; CAD is being supported by higher oil prices however 1.3000 remains as a strong psychological support barrier
  • A better than expected data release of US Unemployment Claims (247,000 actual vs. 266,000 expected) will offer the US dollar strength for the day
  • Oil prices gained strength on the back of a weaker US dollar; gains were ultimately kept in check as worries of global oversupply arose following data released on US Crude Oil Inventories’ rising stockpile numbers
  • Federal Reserve Chair Janet Yellen will speak at 7:00 PM EST today at a town hall event, however, traders do not expect much guidance from Yellen on future monetary policy in her speech
  • FOMC members Charles Evans and Patrick Harker will both speak at 8:30 AM EST at separate events and may offer more substance and comments on 2017 monetary policy

Charts (1) US Unemployment Claims January 2016-January 2017