Comments from both sides of the Atlantic has caused further weakness for the USD. ECB leader Mario Draghi said the EU’s recent economic growth justified a stronger euro, plus US Secretary Treasury Steven Mnuchin reiterated his view that a weaker USD was good for the US economy. Oil Prices are now over $66 USD a barrel for West Texas Intermediate, yesterday’s inventory numbers yet again showed a year over year decline of 15.7%, piercing any chance of an oil glut. Refineries are now operating at 90% capacity, while crude oil imports have increased 91,000 barrels a day, to 8.0 million barrels a day.
USDCAD 1.2292, 1.2282, 1.2238 1.2335, 1.2345, 1.2351
USD-CAD has tipped to a four-month low of 1.2293. The move has reflected a broader decline in the U.S. dollar this week, with U.S. Treasury Secretary Mnuchin having added fuel to the down trend by welcoming the weakness as being good for trade. Focus will remain on the NAFTA front, where a new deal looks to be a probability. USD-CAD has trend support at 1.2250-51.
EUR-USD has settled below highs into the ECB announcement. The pair has settled in the lower 1.2400s after logging a 37-month high of 1.2459 during the Asia-Pacific session. The new high extends the rally seen this week from the low 1.2200s. The ECB’s meeting today is a sharply in focus for market participants looking for further confirmation that the central bank is on course for QE tapering, though what tempering impact on hawkish impulses has been caused by the magnitude of recent euro gains will have on policymaking may prove to be a key driver for forex markets today. EUR-USD has support at 1.2389-90, and resistance at 1.2459-60, head of 1.2500.