​VBCE Daily Foreign Exchange Update for Friday, Nov. 18, 2016

VBCE Daily Foreign Exchange Update for Friday, Nov. 17, 2016

USDCAD spot rate: 1.3530 - 1.3535 (as at 7:40am PST)

Ranges:

Asia:

1.3517

to

1.3566

Europe:

1.3494

to

1.3541

North America:

1.3497

to

1.3537

Technical Support / Resistance:

S2

S1

R1

R2

1.3400

1.3494

1.3566

1.3588

Key Economic Data Releases:

- Canada CPI m/m: 0.2% (exp. 0.2% / prev. 0.1%) y/y: 1.5% (exp. 1.5% / prev. 1.3%)

- Canada core CPI m/m: 0.2% (exp. 0.2% / prev. 0.2%) y/y: 1.7% (exp. 1.8% / prev. 1.8%)

Key Event Calendar:

Date

Canada

U.S.A.

Nov. 21

Nov. 22

Nov. 23

Nov. 24

Nov. 25

Wholesale sales

Retail sales

Existing home sales

Durable goods orders, Manufacturing PMI, consumer sentiment, new home sales, crude oil inventories

Thanksgiving Day

Services PMI

Yesterday, USDCAD tested the 1.3400 level for the 2nd straight day before reversing course through resistance at 1.3466 and 1.3507 eventually testing the 1.3530 level. The pairing edged higher to 1.3466 in Asian trade – just shy of Monday's 9 month high of 1.3588. Although U.S. inflation data missed estimates yesterday, Fed Chair Yellen testified that the Fed could raise interest rates "relatively soon", also indicating that the Fed's expectation to raise rates gradually over the next few years with limited risk of "falling behind the curve." The Fed Funds Futures now suggest the probability of a December rate hike at 90.6%. The trend changed during the London session with USDCAD falling to 1.3494 as oil prices jumped 2.5% on OPEC production cut chatter. Canadian inflation data was mixed with headline data improving for the 2nd consecutive month while core data missed slightly. USDCAD dropped from 1.3527 down to 1.3500 before bouncing back to 1.3537 on broad-based USD strength. The pairing has since held a quiet 1.3515 – 1.3535 range. Despite weakness against the USD, the CAD has made significant gains this week vs. the EUR (near a 7 month low), the JPY (near a 5 month low), and the AUD (near a 2 month low). Currently, the TSX is up 0.11% while the DJIA is down 0.08%. EURCAD is down 0.25% trading between 1.4320 and 1.4388. GBPCAD is down 0.75% trading between 1.6635 and 1.6839. JPYCAD is down 0.35% trading between 0.01223 and 0.01230. Gold is down 0.62% trading between $1,203 and $1,218USD/oz., silver is down 1.17% trading between $16.46 and $16.76USD/oz., while oil is down 0.55% trading between $44.59 and $45.74.

Sources: Reuters, Bloomberg, FXStreet, RBC Capital Markets, Bank of Canada, U.S. Federal Reserve, CNBC, Forexlive, CME Group

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The information and opinions contained herein are gathered from sources which are thought to be reliable but the reader should not assume that the information and opinions are official or final. VBCE makes no warranty concerning the accuracy of the information and opinions, and accepts no liability for the consequences of any actions taken on the basis of the information and opinions provided. The content is for general information only and does not constitute in anyway giving financial advice.