The Canadian dollar started this week as the best performing G-10 major currency against the US dollar. It is benefitting from a rebound in oil prices from Friday’s low and a delayed reaction to Canada’s stellar employment report.
Oil is backing the bid in CAD with West Texas Intermediate crude last seen up US$2.06 to US$69.13 per barrel spot. Talks to revive the 2015 nuclear deal with Iran are said to be floundering which is helping to support the oil price with fewer barrels expected to flood the market in the absence of Iranian crude oil.
The Omicron variant fears eased somewhat, helped by US Chief Medical Advisor to the President Dr Fauci, who said “Though it’s too early to really make any definitive statements about it, thus far it does not look like there’s a great degree of severity to it,”
Looking ahead, the Bank of Canada will be the focus for forex traders. Analysts at TD Securities are looking for a relatively quiet BoC meeting, with limited scope for a meaningful change in tone.
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