​VBCE Daily Foreign Exchange Update for Wednesday, July 20, 2016

USDCAD spot rate: 1.3040 - 1.3045 (as at 7:56am PST)

Ranges:

Asia:

1.3014

to

1.3048

Europe:

1.3014

to

1.3074

North America:

1.3038

to

1.3096

Technical Support / Resistance:

S2

S1

R1

R2

1.2930

1.3014

1.3096

1.3137

Key Economic Data Releases:

- EIA crude oil inventories: -2.342 million barrels (exp. -2.10 million / prev. -2.546 million)

Key Event Calendar:

Date

Canada

U.S.A.

July 21

July 22

Wholesale sales

CPI, retail sales

Philly Fed mfg. , existing home sales

Manufacturing PMI

Yesterday, USDCAD climbed from 1.2944 up to 1.3054 and managed to remain above 1.30 for the bulk of the North American session. The USD enjoyed broad gains as equity markets struggled to add to historical gains and oil prices dropped $1. Overnight, USDCAD broke above yesterday's high of 1.3054 and extended up to1.3096 this morning. Prime Minister Trudeau made headlines noting "real challenges" for the Canadian economy. Oil inventory data out at 7:30am confirmed another draw from inventories sending oil prices up nearly 3%. The quick surge in oil prices caused USDCAD to retrace its daily gains and fall to 1.3030. USDCAD continues to trade in a somewhat neutral bias. The pairing has been confined to a 3 cent range (1.2830 – 1.3137) over the past month. There is some event risk later this week that could see further CAD weakness on the horizon. On Friday, core CPI inflation data is expected to tick lower from 0.3% m/m to 0%. (2.1% y/y to 2.0%) Core retail sales are expected to decline from 1.3% to a reading of just 0.3%. Currently, the TSX is down 0.03% while the DJIA is up 0.25%. EURCAD is up 0.20% trading between 1.4331 and 1.4411. GBPCAD is up 1% trading between 1.7033 and 1.7246. JPYCAD is down 0.50% trading between 0.01223 and 0.01231. Gold is down 1.1% trading between $1,313 and $1,338USD/oz., silver is down 2.3% trading between $19.40 and $19.98USD/oz., while oil is up 1% trading between $44.58 and $45.81.

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

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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.