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USD/CAD Moves Higher after Yellen Speech; Market awaits Details on US Tax Reform

Published September 27, 2017
  • The US dollar broadly strengthened yesterday as the markets digested Janet Yellen’s slightly hawkish speech; despite admitting that the Fed “misjudged” readings of the labor market and inflation, the greenback improved on Yellen’s urgency for monetary policy tightening
  • US Treasury Secretary Steven Mnuchin, Senate Majority Leader Mitch McConnell, House Speaker Paul Ryan and Economic Council Director Gary Cohn and others are set to reveal the details on a US tax reform proposal later today; reports indicate that the corporate tax rate will fall from 35% to 20%
  • US President Donald Trump called the tax reform a “very powerful document” and will give more details at 3:00 PM EST; global stocks are higher in anticipation of the details on how tax cuts will benefit corporations in the US
  • Oil prices remain near their strongest levels in months while giving up modest gains ahead of today’s data release on US crude inventories; speculation of reduced supply brought on by a Kurdish independence movement from Iraq as well as rumors of a supply cut extension have helped boost oil prices this month
  • Bank of Canada Governor Stephen Poloz is set to speak at 11:45 AM EST today in a speech on “Data Dependence – an Economic Progress Report”; investors will watch to see if Poloz reiterates his colleague’s comments on the strength of the Canadian dollar and its effects on Canada’s economy