News and Updates

Rapidly changing market sentiment continues to be the primary driver for the exchange rate between the US and Canadian dollars, causing the Canadian dollar to oscillate. On Friday, concerns about the European banking sector, particularly Deutsche Bank, resulted in a one penny loss for the Canadian dollar, hitting a 9-day low. However, today, the markets have shown signs of optimism as banking regulators provide more assurances, and some troubled banks’ shares climb in value. As a result, the Canadian dollar has regained most of its losses and is currently trading at 1.3658.

We ended our last post by warning that instability in the banking sector could push the value of the Canadian dollar lower versus the US dollar. Sure enough, overnight in Europe, another banking behemoth, Deutsche Bank, came under pressure with its share prices down close to 15% after a jump in demand by investors for insurance against potential default (credit-swap).

This pushed investors and global sentiment into risk aversion mode and helped increase the value of the US dollar against the Canadian dollar. The Canadian dollar has lost about ¾ of a cent and is currently trading at 1.3781, which is a two-week low against the US dollar. We see this as a good opportunity to sell US dollars for frequent US dollar sellers.

As expected, the Federal Reserve approved another quarter-percentage-point interest-rate increase, but much more significantly, it acknowledged that a banking crisis might result in the Fed’s rate-increase campaign coming to an…

The rapid sale of Credit Suisse to its larger rival UBS, and Treasury Secretary Yellen’s promise to step in to protect depositors at additional banks if needed, appears to have…