- USD/CAD moves lower on a subdued US Dollar.
- The decline in the US bond yields has weakened the Greenback.
- The higher WTI price is supporting the Canadian Dollar.
USD/CAD retraces its recent gains reported in the previous two sessions, trading lower around 1.3530 during the European session on Tuesday. The US Dollar (USD) is experiencing some depreciation attributed to subdued US Treasury yields, which is exerting pressure on the USD/CAD pair. Furthermore, the Canadian Dollar (CAD) is receiving support from increased Crude oil prices, contributing to its strengthening against the US Dollar.
The US Dollar Index (DXY) loses ground after reporting profits in the previous two sessions. The DXY trades slightly lower around 104.40, which could be attributed to the weaker US Treasury yields. The 2-year and 10-year yields on US bonds stand at 4.44% and 4.14%, respectively, at the time of writing.
December’s PPI (YoY) reported a decline of 10.6%, against the anticipated decrease of 10.5% and the previous figure of 8.8%. While US ISM Services Prices Paid increased to the reading of 64.0 in January, from December’s reading of 56.7.
Federal Reserve (Fed) Chair Jerome Powell remarked that it was premature to think about easing monetary policy, emphasizing the importance of steering inflation toward its 2% target. He added that the Federal Reserve might initiate its first rate cut from the middle of the year.
West Texas Intermediate (WTI) oil price improves to near $73.00 per barrel on escalated tension in the Middle East. The WTI oil price might have supported the CAD, consequently, putting downward pressure on the USD/CAD pair. Furthermore, Canada’s Ivey Purchasing Managers Index data will be eyed on Tuesday, along with the BoC Governor Tiff Macklem’s speech.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
