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USD/CAD is again under $1.30 right this moment however the primary message loonie has been calm the previous two days, at the same time as power costs have been slammed and bounced.
We get a touch of why that’s right this moment within the Might commerce steadiness report. The $5.32 billion surplus was the most important since 2008 and largely fueled by fossil gasoline exports. Whether or not that is at $100 oil or $120 it ought to stay a robust tailwind and given the worldwide LNG scarcity, the political winds in Canada are enhancing for brand new amenities.
What I discovered significantly notable when it comes to worth motion was yesterday the loonie did not make a brand new excessive. That was regardless of breaking the 2022 excessive a day earlier, regardless of falling oil costs and regardless of a stronger US greenback. As an alternative, if shaped what may very well be a minor double prime at 1.3085.
The measured goal of the minor double prime is 1.2940.
The following Financial institution of Canada choice is on Wednesday, July 13. The probably 75 bps hike will reinforce constructive CAD spreads however oil and the danger/greenback commerce is the primary space to look at.
I spoke with BNNBloomberg on Tuesday about my playbook for CAD for 2022.
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