Daily Afternoon Report 23.08.2017
The U.S. dollar edged higher against its Canadian counterpart on Wednesday, as lower oil prices dented demand for the commodity-related Canadian currency, although sentiment on the greenback remained fragile following remarks by U.S. President Donald Trump.
USDCAD hit 1.2598 during early U.S. trade, the session high the pair subsequently consolidated at 1.2589, adding 0.21%.
The pair was likely to find support at 1.2522, Tuesday’s low and a three-week low and resistance at 1.2693, the high of August 18.
The Canadian dollar was weighed by a drop in oil prices on Wednesday, as concerns over a global supply glut persisted following news of a production increase in Libya.
But sentiment on the greenback remained fragile after President Trump said at a rally in Arizona on Tuesday that he would be willing to shut down the government in order to get the funding needed for his proposed wall along the U.S.-Mexico border.
Trump also warned that he might terminate the NAFTA trade treaty with Canada and Mexico after a first round talks aimed at revamping the trade pact ended with few signs of progress.
Market participants were also looking ahead to this week’s annual meeting of top central bankers and economists in Jackson Hole, Wyoming, where the heads of the U.S. and European central banks will be making keynote speeches.
Investors are especially awaiting speeches from Federal Reserve Chair Janet Yellen and European Central Bank President Mario Draghi on Friday, though neither is expected to announce new policy messages.
The loonie was lower against the euro, with EURCAD advancing 0.50% to 1.4848.