The U.S. dollar fell against its Canadian Counterpart
The U.S. dollar fell against Canadian Dollar on Wednesday. Thus pulling away from the previous session’s two-week high. However, losses were expected to remain short as concerns over geopolitical uncertainties in Europe.USD/CAD hit 1.3144 during early U.S. trade, the session low; the pair subsequently consolidated at 1.3150, shedding 0.27%.
The pair was likely to find support at 1.3072, Tuesday’s low and resistance at 1.3272, the high of January 18.
Markets were jittery amid concerns over the possibility of a Brexit or Trump-style shock result in France’s upcoming presidential election.
Meanwhile, sentiment on the greenback remained supported after Minneapolis Federal Reserve Bank President Neel Kashkari said on Tuesday that the U.S. central bank should keep monetary policy moderately accommodative.
USD/CAD is retreating today
The comments came a day after Philly Fed President Patrick Harker said he would support hiking rates in March. The commodity-related Canadian dollar shrugged off a decline in oil prices on Wednesday. This was ahead of the weekly report on U.S. inventories.
USD/CAD is retreating today following two sessions with gains. It’s coming down from yesterday above the 1.3200. This is coincident with the bottom of the rising channel off May’16 lows. Declining yields in US money markets are not accompanying the recent up move in the buck. Nonetheless, the divergence in policies between the Federal Reserve and the Bank of Canada is expected to play in favour of USD in the next months.
Additionally, crude oil dynamics are important. Albeit momentarily relegated to a secondary role as driver. They have lost upside momentum, dragging the barrel of West Texas Intermediate back to sub-$52.00 levels. This was following a massive build in US supplies, as reported by the API late on Tuesday.