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March 29th - Starting today (March 29th), many European countries have begun observing daylight saving time, meaning that trading hours in European financial markets will be one hour earlier than during winter time. Specifically, starting next Monday, European stock trading hours will be 15:00-23:30 Beijing time. The release times of economic data from various European countries will also be one hour earlier than during winter time. Please take note.On March 29, Fars News Agency and other Iranian media reported that the Iranian Islamic Revolutionary Guard Corps launched missiles and drones to strike two companies in the Middle East that are linked to the US military and aerospace industry.March 29th - According to the "2026 China Toy and Juvenile Products Industry Development White Paper" recently released by the China Toy and Juvenile Products Association, in 2025, the total retail sales of toys (excluding trendy toys) in the domestic market reached 103.53 billion yuan, a year-on-year increase of 5.8%; the total retail sales of trendy and collectible toys reached 67.69 billion yuan, a year-on-year increase of 45.4%.March 29 – Chevron (CVX.N) stated that its Whitstone gas facility in Australia has been damaged by a storm, impacting its restart efforts. Tropical Cyclone Narrele disrupted normal operations at mining and liquefied natural gas facilities along Australias northern and western coasts over the past week. In a statement, Chevron said, "The Whitstone gas facility near Onslow has suffered equipment damage due to severe weather, affecting restart efforts." The company added that it will take "several weeks" for the Whitstone facility to return to full production.On March 29, Iran released satellite images showing the destruction of a US E-3 early warning aircraft. The Iranian Islamic Revolutionary Guard Corps issued a statement on the 29th, claiming that an E-3 early warning aircraft at the Prince Sultan Air Base in Saudi Arabia had been completely destroyed. Other nearby aircraft also suffered severe damage. According to Iranian sources, the Prince Sultan Air Base in Saudi Arabia was recently attacked by Iranian missiles and drones, and one US E-3 early warning aircraft was damaged in the attack.

As oil prices fall and investors become risk-averse before the BOC meeting, USD/CAD rises to 1.3200

Daniel Rogers

Sep 07, 2022 16:50

截屏2022-09-07 上午11.31.45.png 

 

The USD/CAD has risen for three consecutive trading days, and it is currently trading near 1.3190, which is the weekly high. To appease buyers near the highest levels in two months prior to the Bank of Canada (BOC) Monetary Policy Meeting, the Loonie pair has recently been applauding rising rates and a risk-aversion wave.

 

Declining prices of WTI crude oil, Canada's principal export, further strengthen the USD/CAD exchange rate as speculators anticipate the fifth BOC rate hike in 2022.

 

WTI crude oil prices have dropped to their lowest level since late January, down 1.70 percent to $85.40 as of press time on the back of recession worries and a stronger US dollar. Market perceptions of the latest production cut by OPEC and its partners, including Russia, known collectively as OPEC+, could add to the downward pressure on commodity prices.

 

In addition to the covid-related pessimism in China and the European energy crisis, improved US data strengthened the hawkish Fedbets and boosted the US dollar.

 

In the United States, the ISM Services PMI rose to 56.7 from 55.1 and above market expectations. In contrast to initial expectations of 45.0 and 44.1, the S&P Global Composite PMI and Services PMI both fell to 44.6 and 43.7, respectively. Still, following the news, the US Dollar Index (DXY) rose to a new 20-year high. There is now a 72.0% possibility of a 50 bps rate hike by the Fed in September, according to the CME's FedWatch Tool, up from 57.0% the day before.

 

The three-day surge in rates for 10-year US Treasuries to 3.25 percent is the highest it has been since June 15. The S&P 500 futures have also dropped to a new seven-week low, falling 0.55 percent intraday to 3,890.

 

The stronger U.S. dollar, declining oil prices, and reduced risk appetite should keep USD/CAD bulls optimistic despite the BOC's expected base rate increase of 75 basis points to 3.25 percent. Consolidating recent gains may be possible for the Canadian currency, however, thanks to hawkish comments from the BOC Rate Statement and softer Fedspeak.


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