The Loonie is currently trading at 1.2600 having moved higher on the day. The pair moved between a low of 1.2516 and a high of 1.2602 so far. The US dollar has grown despite sinking US yields. The 10-year yields are down down some 2.9% on the day. The safe haven pairs are collecting the flows on Tuesday as fears about the lasting impact of the coronavirus crisis resurfaced.
Markets are drifting away from the Euro due to concerns over a third wave of the covid-19 pandemic during slow vaccine rollouts in Europe which have led to an extended economic lockdown in Germany. Germany’s government expanded its lockdown measures until the 18th of April, while Chancellor Angela Merkel called on nationals to stay at home for five days over the Easter holidays.
A key contributor to the drop in the Canadian Dollar is the defeat in oil. WTI is down 5.65% having dropped from a high of $61.33bbls to a low of $57.35bbls in recent trade.
The Canadian dollar was pressured back towards the session lows on the move in oil ahead of Congressional testimony by Federal Reserve Chair Jerome Powell and Treasury Secretary Janet Yellen later in the day.
Today traders will be waiting for speeches to reveal the rate of economic rebound from the pandemic.
In remarks prepared for delivery to the hearing on Tuesday morning, Powell said the US economic recovery had progressed “more quickly than generally expected”.
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