| Wrap Up |
| The Canadian dollar rose to a 10-day high against the greenback as investors bet that a meeting between U.S. President Donald Trump and Federal Reserve Chair Jerome Powell could increase prospects for U.S. interest rate cuts. Trump has frequently criticized the Fed for setting interest rates too high. The U.S. central bank has cut rates three times this year – in part to offset what it views as damage done by the Trump administration’s trade war with China. BoC Senior Deputy Governor Carolyn Wilkins will speak Today on safeguarding the Canadian financial system, while Governor Stephen Poloz is due to speak on Thursday on economic change. The gap between the 10-year yield and its U.S. equivalent narrowed by 2.5 basis points to a spread of 32.7 basis points in favor of the U.S. bond. |
| Levels and recommendations |
| The US dollar index snapped a three-day losing streak against rivals thanks to gains in the Swiss franc and the Japanese yen but remained trapped within well-worn ranges before the release of minutes from the latest U.S. central bank meeting. The British pound was slightly weaker, though not far from a six-month high versus the euro, as traders remained broadly of the view that the ruling Conservative Party will get a majority in Britain’s parliament following the election next month. The Australian dollar swung lower after the central bank said it had seen a case for cutting rates this month, a dovish surprise that led investors to narrow the odds on future easing. The Canadian dollar is trading flat around 1.3213 levels as domestic factory sales fell than expected. On the other crude oil prices fell for the second consecutive day due to an expectation of a rise in US inventories which underpinned the demand for loonie. The USDCAD pair is trading near important resistance level of 1.3220 and further movement will largely depend on the outcome of speech from Canada government council. |