- USD/CAD hovers above the 1.3800 psychological level on downbeat Crude oil prices.
- WTI prices eased on concerns about diminishing demand in US and China.
- US Dollar remains tepid despite hawkish remarks from Fed Chair Powell and the uptick in US bond yields.
USD/CAD recovers recent losses registered on Friday, bidding higher around 1.3810 during the Asian session on Monday. The Canadian Dollar (CAD) received gains in the previous session on the back of improved Crude oil prices.
However, West Texas Intermediate (WTI) Crude Oil price pulls back and trades below 76.50 at the time of writing. Oil prices step back as renewed worries about diminishing demand in both the United States (US) and China cast a shadow over market sentiment. Concerns about the economic giants are putting a dent in the oil market dynamics.
The yearly decline in Chinese inflation recorded in October could potentially dampen the outlook for global growth. This has a direct impact on the demand for crude oil, given that China is a major importer of oil.
On the US Dollar (USD) side, the surprise hawkish remarks from Federal Reserve (Fed) Chair Jerome Powell failed to boost the Greenback. Powell's concerns about the current policies not being robust enough to bring inflation down to the coveted 2.0% target seem to have left the USD in a state of limbo.
US Dollar Index (DXY) seems to be in a bit of a holding pattern, lacking a clear direction, hovering around 105.80. The index faced pressure after the release of downbeat preliminary US Michigan Consumer Sentiment data on Friday. The report showed a decline in consumer mood, falling from 63.8 in the previous month to 60.4 in November.
However, upbeat US Treasury yields could help the US Dollar to gain upward traction. The yield on the 10-year US bond coupon stands at 4.65%, reflecting a 0.13% increase by the press time.
Traders are expected to focus on the US Consumer Price Index (CPI) scheduled to be released on Tuesday. On Canada’s docket, low-impact data events are in line such as Wholesale Sales and Industrial Product Price during the week.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD clings to gains above 1.0850 after US inflation data
EUR/USD trades in positive territory above 1.0850 in the American session on Friday. The US Dollar struggles to preserve its strength following the April PCE inflation data and helps the pair hold its ground heading into the weekend.
GBP/USD retreats from 1.2765, holds on to modest gains
GBP/USD posted a two-day high peat at 1.2765 in the American session, as US data showed that the core PCE inflation held steady at 2.8% on a yearly basis in April. The pair retreated afterwards as risk aversion triggered US Dollar demand.
Gold falls towards $2,330 as the mood sours
US inflation-related data took its toll on financial markets. Wall Street turned south after the opening and without signs of easing price pressures in the world’s largest economy. The US Dollar takes the lead in a risk-averse environment.
Here’s why Chainlink price could crash 15% despite spike in social volume Premium
Chainlink price has flashed multiple sell signals after its recent climb, hinting at a short-term correction. This signal comes despite a double-digit growth in its social volume. LINK bulls need to exercise caution as this forecast is backed by on-chain metrics.
Week ahead – ECB rate cut might get eclipsed by BoC surprise and NFP report
ECB set to slash rates on Thursday, focus on forward guidance. But will the BoC take the lead when it meets on Wednesday? US jobs report eyed on Friday as Fed unyielding on cuts. OPEC+ might extend some output reductions into 2025.