| Wrap Up |
| The Canadian dollar was little changed against the U.S. dollar, extending this week’s holding pattern, as markets awaited a clearer signal from central banks on the outlook for interest rates. Most Fed policymakers supported the need for an interest rate cut in September, minutes of the central bank’s last policy meeting showed on Wednesday. The price of oil, one of Canada’s major exports, gave up its earlier gains as a build in U.S. crude inventories offset potential disruption to supply and hopes of progress in ending the U.S.-China trade war. Canadian government bond prices were lower across the yield curve in sympathy with U.S. Treasuries after a flood of supply. The two-year bond fell 6 Canadian cents to yield 1.474% and the 10-year bond was down 31 Canadian cents to yield 1.312%. |
| Levels and recommendations |
| A dive in the dollar catapulted the euro higher and flattened stocks as the first U.S.-China trade talks since July and a report accusing the European Central Bank chief Mario Draghi of going rogue jostled for attention. The euro shot above $1.10 versus the dollar as the greenback turned weaker across the board partly due to market chatter about a currency pact with China to stop devaluation – but there was plenty else too. The Turkey’s lira and government bonds saw another day of falls as investors fretted about negative international reaction to Ankara’s military operation in northeast Syria. The Canadian dollar is trading stronger around 1.33 mark after upbeat domestic NHPI data. On the other hand disappointed US employment data has increased the chances of further rate cuts by US Fed. Loonie got an additional boost with an increase in crude oil prices due to ongoing Turkey- Syria tensions and trade hopes. The USDCAD pair has an immediate resistance at 1.3290 and it is expected to trade in the range of 1.3290 – 1.3350 levels. |