The Canadian dollar closed as a net loser on Friday, taking hits from multiple angles including a big drop in oil prices, more stimulus from the Bank of Canada, and another round of weak economic updates Canada.
Canadian Headlines and Economic data
The Loonie saw a broad rally during the U.S. trading session and without notable likely catalysts from Canada, traders may have been pushing CAD higher off of U.S. dollar weakness and a bounce in oil prices after a record deal by OPEC+ to cut oil by 9.7M barrels per day to end the price war.
The Loonie began its drift lower against the other major currencies on the session, perhaps a response to oil’s fall in prices (as seen in the chart above) as fears rise that the aforementioned production cuts will not overcome the falling demand.
We also started to get terrible global economic outlook projections (e.g., Coronavirus ‘Great Lockdown’ to shrink global economy by 3% in 2020: IMF) that possibly weighed down some risk assets.
Another broad move lower in CAD against most of the majors due to oil during the Asia – London sessions after API reports mega crude inventory build of over 13M barrels at the end of last week.
Broad move higher in CAD against most of the majors at the end of the U.S. trading session, perhaps on prospects of the U.S. having a plan to re-open the economy (Trump suggests U.S. states re-open economies in three phases in new guidelines) to spark a broad risk-on rally.