The USD/CAD Continues To Press Down
March 16, 2010 12:23 PM
The Canadian dollar extends its rally, as commodities, oil in particular, rise during today’s trading. OPEC is expected to keep the output steady, which means that any data pointing at higher oil demand will push the price higher, at least in the short term, which will contribute to further CAD gains.
The Canadian currency’s impressive rally is also supported by the recent strong economic readings. Almost every economic data in Canada (unemployment, trade, productivity, etc.) seems to beat the expectations, underlying the fact that the Canadian economy is moving towards a recovery. The USD/CAD pair is hovering around 1.050 and probably will stay there till the FOMC interest rate decision later this afternoon.
While the general expectation is for the rate to remain unchanged, any hawkish comments by the Fed will give a real boost to the USD. The bigger picture, however, still favors the parity level of the USD/CAD pair.
