USD/CAD edges higher to 1.3600 mark amid bearish Oil prices, looks to Fed for fresh impetus
Trending Articles- Gold jumps over 2% toward $5,400 after US, Israel attack Iran
- Senate to vote on Trump’s pro-Bitcoin Fed pick as BTC hits four-week high
- Strait of Hormuz Blockade: JPM Warns Crude Production May Halt After 25 Days. How Will US-Iran Conflict Trajectory Affect Global Oil Prices?
- Gold slumps below $5,100 as US Dollar gains
- WTI Price Forecast: Retreats from seven-month top, still well bid near $71.00 mark
- WTI climbs back closer to $72.00 as closure of Strait of Hormuz fuels supply concerns
●USD/CAD gains some positive traction for the second straight day, albeit lacks follow-through.
●Bearish Crude Oil prices continue to undermine the Loonie and act as a tailwind for the major.
●Traders, however, seem reluctant to place aggressive bets ahead of the FOMC policy decision.
The USD/CAD pair trades with a positive bias for the second successive day on Wednesday, albeit lacks bullish conviction and remains below a multi-day peak, around the 1.3615-1.3620 region touched the previous day. Spot prices currently trade around the 1.3600 round figure as traders keenly await the outcome of the highly-anticipated two-day FOMC monetary policy meeting.
The Federal Reserve (Fed) is scheduled to announce its decision later during the US session and is widely expected to maintain the status quo. Hence, the focus will remain on the accompanying monetary policy statement and the updated economic projections, especially the so-called "dot plot". This, along with Fed Chair Jerome Powell's remarks at the post-meeting press conference, will be scrutinized for clues about the near-term policy outlook, which will influence the US Dollar (USD) price dynamics and provide a fresh directional impetus to the USD/CAD pair.
In the run-up to the key central bank event risk, the uncertainty over the timing of when the Fed may begin easing its policy fails to assist the USD to build on the overnight bounce from the post-US CPI low and acts as a headwind for the USD/CAD pair.
The downside, however, remains cushioned in the wake of bearish Crude Oil prices, which dropped to a fresh six-month low amid oversupply concerns and despite signs of a draw in US inventories. This, in turn, undermines the commodity-linked Loonie and remains supportive of the bid tone surrounding the major.
Nevertheless, the aforementioned mixed fundamental warrants some caution before placing aggressive directional bets around the USD/CAD pair. Furthermore, the range-bound price action witnessed over the past week or so points to indecision among traders over the near-term trajectory for the major.
Read more
* The content presented above, whether from a third party or not, is considered as general advice only. This article should not be construed as containing investment advice, investment recommendations, an offer of or solicitation for any transactions in financial instruments.
