USDCAD Tests 2019 Low, USD Pullbacks on Month-End Rebalancing - US Market Open
USD: Yet again ranges are relatively tight ahead of the G20 summit. The USD had come under initial pressure in the European morning session as rebalancing flows weighed. G10 currencies are generally firmer against the greenback, which has managed to hold the 96.00 handle thus far.
CAD: A mixed GDP report saw USDCAD bounce off yearly support at 1.3068. Tightening yield differentials and rising oil prices favour further CAD gains against the greenback. However, the BoC survey outlook could cap further upside in the near term, with the survey most likely to have been covered from early May to early June, which had been when US-China trade tensions had escalated.
EUR: Eurozone inflation had been in-line with expectations, while the core rate had jumped to 1.1%, however, this remains far from the ECB’s mandate and as such, saw a limited reaction in the Euro and short-end rates. Consequently, there is little to suggest that the ECB will not provide further stimulus from Q4.
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--- Written by Justin McQueen, Market Analyst
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