| Wrap Up |
| The Canadian dollar was little changed against its U.S. counterpart as this week’s stronger-than-expected domestic data was offset by reduced investor appetite for risk. U.S. stocks plunged in a broad sell-off as China and the United States traded their latest salvos in a prolonged trade war. Data this week showed Canada retail sales in June and inflation in July both beat expectations. The Canadian dollar was trading nearly unchanged at 1.3296 to the greenback, or 75.21 U.S. cents at 4:23 p.m. The currency was down 0.2% for the week. Canadian government bond prices were higher across the yield curve, with the two-year bond up 17.5 Canadian cents to yield 1.379% and the 10-year bond rising 111 Canadian cents to yield 1.175%. |
| Levels and recommendations |
| Global markets clawed themselves off their lows but sentiment remained fragile after the latest flare-up in the U.S.-China trade war sent investors scrambling into government bonds and battered emerging market currencies. China’s yuan plunged to an 11-year low in the onshore market and hit a record low in offshore trading. It later recovered somewhat in the offshore market but remained 0.3% lower at 7.1552. Turkey’s lira dropped more than 1% to more than 5.8 against the dollar after briefly sliding to 6.47 in what market watchers described as a “flash crash” as Japanese investors slashed their exposure to riskier assets. The Canadian dollar is trading week above 1.33 mark due broader strength seen in the US dollar index after US manufactured durable goods date rose in July to beat the market expectation. However the downside to CAD is limited due to an increase in crude oil prices as US-China voiced their willingness to negotiate the trade concerns in a calm manner. The USDCAD pair is expected to trade in the range of 1.3275-1.3325 levels for the day. |