Yesterday, after starting the day up against USD, the Canadian dollar gave up a cent over the course of the day to close down 0.4%. In fact, the Canadian dollar was the weakest performing major yesterday. It was a somewhat unusual move and the reasons were not clear but were said to have to do with specific flows associated with several large transactions. This morning, optimism abounds again and stocks are up and the US dollar is down. The Canadian dollar is again trading near 8-month highs. Renewed contacts between China and US on trade talks are said to be part of the reason for today’s global optimism and oil is up 2%. There is a tremendous amount of focus on Fed Chairman Powell’s speech on Thursday where it is expected that he will potentially reframe the inflation debate in a way that moves the Fed in a more dovish (market friendly and USD unfriendly) direction.
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