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Risk-Off Sentiment Hits Canadian Dollar As US Dollar Surges Close To Three-Week High

By Daily Updates

The Canadian dollar is approaching a three-week low against the US dollar today as negative market sentiment propels the US dollar higher. The combination of Chinese equity markets moving into negative territory for the year and the rapidly approaching US debt ceiling deadline has led investors to sell riskier assets such as the Canadian dollar and buy safe haven assets such as the US dollar.

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USD/CAD at a Standstill, As Fed & BoC Paths Converge

By Daily Updates

Overnight, the Canadian dollar weakened by about ¼ of a penny against the US dollar. However, this morning, both the CAD and USD are underperforming against major global currencies. The USD/CAD pairing has mostly experienced range-bound trading over the last two days, with the exchange rate bouncing between defined levels. All the action occurred earlier this week following the release of higher-than-expected April inflation numbers in Canada. Initially, this news provided a temporary boost to the Canadian dollar, leading to a decline in USD/CAD from a high of 1.3567 to around 1.3400 on Wednesday. However, much of this decline was quickly reversed.

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The Canadian Dollar Surges After Hotter April Inflation

By Daily Updates

The Canadian dollar has gained another half cent against the US dollar overnight and has now risen by 1.5 cents since yesterday’s low. This surge in the Canadian dollar’s value occurred after the release of higher-than-expected Canadian inflation numbers this morning. In April, inflation rose by 0.7%, surpassing the 0.4% anticipated by analysts. Additionally, on an annualized basis, Canadian inflation increased by 4.4% compared to the expected 4.1%. This has created a more uncertain path forward for the Bank of Canada.

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Canadian Dollar Gives Up Gains Versus the US Dollar, As Outlook Turns Negative

By Daily Updates

Markets were generally lower on Thursday as investors grappled with understanding the implications of yesterday’s inflation numbers, which came in slightly lower than expected at 4.9% instead of 5%. The ongoing crisis in the US regional banking sector also weighed heavily on the markets, with another US regional bank facing pressure. PacWest’s shares plunged over 20% today after reporting larger than expected deposit outflows. These factors caused nervousness among investors, leading them to seek safe haven currencies like the US dollar. Consequently, the US dollar traded higher against most currencies, including the Canadian dollar. The Canadian dollar dropped by ¾ of a penny this morning and has now lost over a full penny since Monday’s near one-month high.

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