Sentiment has improved a bit today, following last week’s risk aversion. The result is that the Canadian dollar is getting a bit of a boost against its major counterparts. Part of the reason for the risk appetite is that there hasn’t been any substantial response to the results of the referendum held in Crimea over the weekend.
For now, risk appetite is the story to start the week. Even though Crimea has declared independence from Ukraine and asked to join Russia, the reality is that many are still waiting for the rest of the world to decide its response. So, in this pause, there is a bit of risk appetite, and the Canadian dollar is reaping some of the benefits, even though commodity prices are slightly lower.
Even with Canada’s gains, though, trading is likely to take place within a tight range. Bank of Canada governor Stephen Poloz is expected to deliver a speech on Tuesday, and many are waiting for Statistics Canada to release February inflation data on Friday. For now, the loonie is likely to move with market sentiment. Later this week, there will be more specific guidance.
At 13:49 GMT USD/CAD is down to 1.1077 from the open at 1.1102. EUR/CAD is down to 1.5440 from the open at 1.5442. GBP/CAD is down to 1.8441 from the open at 1.8479.
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