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On May 25, 2026, Pan Gongsheng, Governor of the Peoples Bank of China (PBOC), met with Jean-Pierre de Gallo, Governor of the Bank of France. The two exchanged views on the global and Chinese economic situation, Sino-French and Sino-European economic and financial cooperation, and global economic and financial governance. Pan Gongsheng stated that in recent years, under the strategic guidance of the heads of state of China and France, Sino-French relations and cooperation have made positive progress. Currently, the global economy faces multiple challenges, including geopolitical conflicts. China and France, and China and Europe, should strengthen strategic communication, jointly uphold multilateralism, and work together to build a more fair, just, inclusive, and resilient global financial governance system. China is firmly committed to opening up its financial sector and welcomes financial institutions from all countries, including France, to deepen their presence in the Chinese market. The PBOC is willing to continue deepening exchanges and cooperation with the Bank of France to elevate Sino-French and Sino-European financial cooperation to new heights. De Gallo stated that deepening Sino-French and Sino-European cooperation is of great significance in the current complex and volatile international situation. The Bank of France attaches great importance to its cooperative relationship with the PBOC and is willing to further strengthen communication and coordination to jointly promote the improvement of global economic and financial governance. Following the meeting, De Gallo delivered an academic lecture at the Peoples Bank of China and exchanged views with staff. Xuan Changneng, Vice Governor of the Peoples Bank of China, attended the meeting and chaired the lecture. Yi Gang, President of the China Finance Society, also attended the lecture.The SC crude oil futures contract narrowed its intraday decline to 2.00%, currently trading at 609.20 yuan per barrel.The Bank of Israel lowered its benchmark interest rate from 4.00% to 3.75%.On May 25, it was reported that Indias Statistics Department has proposed adjustments to its monthly industrial output calculation method, including expanding industry coverage and adopting a chain-linked framework; this move is intended to align with the release of a new series of industrial output data scheduled for next week. A technical advisory group within the department has recommended extensive reforms to the Industrial Production Index (IIP), including separately tracking renewable energy generation and incorporating utilities such as gas supply, water supply, wastewater treatment, and waste management.According to Irans Mehr News Agency, air defenses have been activated over Qeshm Island, Iran, for reasons unknown.

USD/CAD Trades at a Flat Level Following Volatile Trading and Rising US Treasury Yields

Drake Hampton

Apr 06, 2022 10:16

Insights

  • The dollar fell as additional penalties against Russia weighed on the Loonie.

  • Benchmark rates increased as the Federal Reserve pursued a more aggressive rate hike strategy.

  • Due to the new penalties, gold and silver prices remained rather stable.

  • As European countries ponder further measures, oil prices continue to rise.

 

Despite a volatile trading session, the dollar maintained its strength as higher oil prices bolstered the commodity-linked Loonie. The yield on ten-year government bonds increased to 2.56 percent, the highest level since May 2019. Benchmark rates increased several basis points following Fed Governor Brainard's statement that the Fed must pursue a more aggressive stance to contain inflation. Commodity-linked currencies such as the Loonie increased in value as a result of higher oil prices and good economic indicators. New sanctions against Russia continue to benefit silver and gold prices. On the potential of fresh Russian sanctions, oil prices continued to increase. Investors are awaiting the release of the minutes from the most recent FMOC meeting on Wednesday.

 

Today, the US released its February trade balance. Actual balance of -$89.2 billion was lower than predicted at -$88.5 billion. The reading stayed relatively stable compared to the previous month, indicating a record deficiency. Exports increased by 1.8%, while imports jumped by 1.3 percent. In the following months, the Russia-Ukraine war may limit demand for US exports.

Technical Evaluation

The USD/CAD exchange rate remained unchanged following a recovery from the downward pressure caused by increased oil prices, which supported the Loonie. However, losses should be contained as a result of the Fed's more aggressive rate hikes. The pair remains below the key level of 1.25 and may be driven lower as additional penalties against Russia increase. Resistance is located near the 10-day moving average, which is now at 1.25. Near today's lows near 1.24, support is seen. A break below support would reveal the daily low of 1.2387 from November 10th, signaling further downward pressure. The short-term momentum shifted to the upside when the fast stochastic crossed above the buy signal.

 

Although the MACD line generated a crossover sell signal, the medium-term momentum is negative but favorable. When the MACD line (the 12-day moving average minus the 26-day moving average) passes the MACD signal line, this scenario occurs (the 9-day moving average of the MACD line).

 

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