The USDCAD is unchanged even as oil prices have dropped slightly, markets are becoming more focused on what the Federal Reserve will do in the short term. Traders have been speculating on the possibility of the central bank cutting rates due to slowing inflation and rising trade tensions after Fed Chairman Jerome Powell signaled the bank would “act as appropriate to sustain the expansion, with a strong labor market and inflation near our symmetric 2% objective.” The Fed is expected to keep rates unchanged at its meeting on June 19, with an 83.2% chance of a cut priced in for its July meeting.
This leaves the Bank of Canada the choice of following suit, allowing the USDCAD to remain the same, or leaving rates unchanged, it’s preference, and having a very strong CAD. We will have to wait and see.
Currently Close Range
USDCAD 1.3292 1.3284 1.3274-1.3305
EURCAD 1.5040 1.5046 1.5023-1.5083
GBPCAD 1.6877 1.6905 1.6868-1.6984
US: Consumer Price Index M/M 0.3% 0.1%
Y/Y 2.0% 1.8%
Petroleum Status Report wk6/7
Crude Oil Inventories 6.8M Brls 2.2M Brls
Gasoline 3.2M Brls 0.8M Brls