Forex Market Analysis - USD/CAD currency pair side-lined below mid-1.3900s, Powell’s testimony expected
- USD/CAD currency pair remained depressed through the mid-European session on Tuesday.
- The upbeat market mood, slippy United States bond yields undermined the USD demand.
- A modest pickup in oil costs benefitted the loonie and exerted some pressure.
- Traders appeared reluctant to position aggressive bets before Powell’s testimony.
The USD/CAD currency pair did not maximize its tried intraday recovery move, instead met with some recent provide close to the 1.3970 regions. The currency pair was last seen trading with a slight negative bias close to the 1.3925 regions, well inside the putting distance of one-week lows set earlier this Tuesday.
The currency pair remained depressed for the second straight session and was being weighed down by a mix of things – sustained United States dollar selling bias and positive crude oil costs. The currency pair, however, showed some resilience at lower levels then so much, has managed to defend the 1.3900 round-figure marks.
The optimism over the re-opening of economies in some elements of the planet and inspiring knowledge on coronavirus vaccinum trial weighed on the USD’s safe-haven standing. Adding to the current, a modest pullback within the United States Treasury bond yields conjointly undermined the dollar demand and exerted some pressure on the USD/CAD currency pair.
This in addition to an intraday pickup in oil costs benefitted the commodity-linked currency – the loonie – and any contributed to the pair’s weaker tone through the mid-European session. Oil costs remained well supported by signs of gradual demand recovery on the rear of easing imprisonment restrictions globally.
Meanwhile, investors appeared reluctant to position any aggressive bets, rather most well-liked to attend on the sidelines before the Fed Chair Jerome Powell’s legislature testimony. Powell’s comments are closely scrutinized for any more financial easing, which can play a key role in influencing the near-term USD value dynamics and supply a recent directional impetus to the USD/CAD currency pair.