The greenback rose to the day’s highs against a basket of currencies today after the Federal Reserve Chair Jerome Powell reiterated that the US central bank would likely move forward with a gradual increase in interest rates. Powell promised to continue to strike a balance between avoiding an overheated economy and bringing inflation back near the Fed’s target of 2%, while also giving an upbeat outlook for the American economy. He further added that, despite recent volatility, financial conditions remained accommodative.
Weaker US durable goods data (as seen in table below) was partly offset by a negative trading sentiment around crude oil prices, which was seen weighing on the commodity-linked loonie, and remained supportive of the pair’s strong bid tone through the early NA session.
Oil prices edged lower today ahead of weekly data that is forecast to show a rise in US crude inventories, although investor faith in OPEC’s ability to curtail production helped stem a larger price slide with Brent crude down ~0.13% and WTI crude down ~0.28% (at time of writing), trading at $67.50 and $63.77/barrel respectively. International Energy Agency (IEA) Executive Director Faith Birol said today that the US will overtake Russia as the world’s largest oil producer by 2019.
Canada’s Finance Minister Bill Morneau will deliver his third federal budget statement today at 4pm EST. This fiscal plan is meant to strengthen the economy by promoting gender equality and bringing more women into the workforce. The budget is also expected to boost science and innovation, improving living conditions for Indigenous people and fortify Canada against cyber attacks. Coming one year before the 2019 pre-election budget, this Liberal spending plan could be more about tweaks, minor initiatives and shifting allocations than big, bold new program spending.