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Canadian Dollar Doesn’t Pay Heed to Supportive Fundamentals

January 31, 2017 at 23:02 by Vladimir Vyun

Canadian coins on Canadian dollar billsThe Canadian dollar gained on its weak US counterpart during Tuesday’s trading but was unable to beat such strong currencies as the euro and the Japanese yen despite supportive fundamentals.

Canada’s gross domestic product rose 0.4% in November, exceeding the analysts’ median projection of 0.3%. What is more, the previous month’s change was revised from -0.3% to -0.2%.

The Raw Materials Price Index increased 6.5% in December, far surpassing the average forecast of 2.9%. The only underwhelming part of Tuesday’s data was the Industrial Product Price Index, which rose by 0.4% instead of 0.5% promised by forecasters, though even it was not bad strictly speaking.

On top of the positive macroeconomic indicators, crude oil prices bounced after yesterday’s drop.

Yet all the good news were unable to provide a strong boost to the loonie, and the Canadian currency demonstrated rather unimpressive performance against most of its major rivals.

USD/CAD dropped from 1.3117 to 1.3044 as of 22:49 GMT, and its daily low of 1.2983 was the lowest since September 9. Meanwhile, EUR/CAD rose from 1.4024 to 1.4079. CAD/JPY dropped from 86.71 to 86.37.

If you have any questions, comments, or opinions regarding the Canadian Dollar, feel free to post them using the commentary form below.

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