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On August 17th, Takehiko Nakao, former Japanese Finance Minister and President of the Asian Development Bank, stated that the Bank of Japan should raise interest rates at every policy meeting, aiming to elevate the benchmark rate to above 2% to narrow the interest rate differential between Japan and the US and alleviate pressure on the yens depreciation. He noted that even with Japans policy rate already at 1%, its real interest rate remains negative, while other countries have positive real interest rates. He believes that with inflation around 2%, a policy rate of 2.25% or 2.5% in Japan would not be uncommon.On August 17th, according to Tianyancha App, Kunming Beiye Data Technology Co., Ltd. was recently established. The legal representative is Qiu Jinghao, with a registered capital of 700 million RMB. It is a limited liability company (wholly foreign-owned), currently in operation, and its registered address is located in the Digital Economy Industrial Park, Enclosed Area of the Mohan-Boten Cooperation Zone. The companys business scope includes software development, information system integration services, information technology consulting services, and retail of computer hardware, software, and auxiliary equipment. Shareholder information shows that Beijing Zitiao Network Technology Co., Ltd. holds 100% of the companys shares, with a subscribed capital of 700 million RMB.Japanese power company J-Power: It will build a data center in Kaminokuni, Hokkaido, and will begin selling its GPU data center computing power in the summer of 2027.August 17th - According to the National Forestry and Grassland Administration, since the launch of the Three-North Shelterbelt Projects critical phase, the National Forestry and Grassland Administration, together with local governments and departments, has adhered to a systematic approach and scientific methods, allocating a total of 88.9 billion yuan in central government investment and implementing 544 key projects. The average annual construction area completed has exceeded 80 million mu (approximately 5.3 million hectares), making this the period with the greatest progress and best results in the projects history. Ecological benefits are gradually emerging, with the forest and grassland coverage rate in the project area reaching 40.76%, and the treatment rate of manageable desertified land reaching 67.82%, representing increases of 1.13 and 12.78 percentage points respectively compared to 2020. The main mid-term goals of the sixth phase of the Three-North Shelterbelt Project have been fully achieved.The New Taiwan dollar rose to 31.874 against the US dollar, a new high since July 2.

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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