USD/CAD struggles to surpass 1.3600 on upbeat Oil prices
- USD/CAD consolidates due to improved prices of Crude oil.
- Investors await top-tier macroeconomic data releases from both economies.
- Chinese authorities reduced the stamp duty on stock trading; WTI crude oil strengthened.
USD/CAD holds ground near 1.3600 to continue its winning streak, during the early hours of the European session on Monday. The pair is experiencing downward pressure due to the retreating US Dollar (DXY) along with the improved prices of WTI crude oil amid optimistic market sentiment ahead of the top-tier economic data releases later in the week including United States (US) Core Personal Consumption Expenditures (PCE) Index, the weekly Jobless Claims, Nonfarm Payrolls and Canada’s Gross Domestic Product (GDP).
Beijing took the step of reducing the stamp duty on stock trading by 0.1%, a move that contributed to the positive trajectory of Crude oil prices. Prior to this, investors had seen Beijing’s previous efforts to stimulate the economy as somewhat ineffective. As a result, there was a call for the Chinese authorities to implement more targeted fiscal measures that align with the country’s economic circumstances.
The WTI Crude oil trades around $80.50 at the time of writing. The Oil buyers currently focus on the four-day visit of US Commerce Secretary Gina Raimondo to Beijing. The primary aim of this visit is to enhance business ties between the United States and China.
The US Dollar Index (DXY), which tracks the Greenback against a basket of currencies, trades around 104.10 just below its highest level in more than two months. The retreating US Treasury yields are undermining the US Dollar (USD) due to the cautious mood after the US Federal Reserve (Fed) Chairman Jerome Powell advocated for supporting “higher for longer” interest rates.
Powell also highlighted that there is still a substantial amount of progress needed to attain price stability. Given the prevailing economic uncertainty, he emphasized the necessity for flexible and agile decision-making in shaping monetary policy.