Last night’s range on the USDCAD was quite narrow, traders have ignored lower oil prices, lower stock markets and higher gold prices. Tomorrow’s interest rate announcement will set the trend for the near future in regard to further hikes.
Oil has fallen nearly 3% this morning, Saudi Arabia has pledged to meet any supply shortfall that materializes resulting from Iranian sanctions and as tumbling equities weakened sentiment. U.S. stocks slumped, with the Dow Jones Industrial Average tumbling as much as 548 points, after results from Caterpillar and 3M added to concern that corporate profit growth has peaked. The yen, gold and Treasuries all rallied on demand for haven assets.
Expect narrow range on USDCAD unless equites even further.