The Canadian dollar is slightly stronger this morning after weakening yesterday. The currency has been benefiting from stronger crude oil prices. Recent data from the American Petroleum Institute showed that US crude stocks have fallen significantly. If the US Energy Information Administration's numbers (set to be released later today) confirm API figures, the loonie can strengthen further. Crude oil prices remain in a bull market thanks to relatively weaker supply relative to demand.
The USD/CAD exchange rate is currently below 1.2760. The euro is flat against the Canadian dollar. EUR/CAD is currently above 1.50. Lastly, the pound is flat against the Canadian dollar, with GBP/CAD trading above 1.690.
This is a fairly light week for the Canadian dollar in terms of economic data releases. Later today, we’ll see the Federal government budget balance. On Thursday, we’ll see retail sales for September. Last week, the Canadian dollar sold off after meeting CPI estimates.
As the Canadian dollar weakens further, we are downgrading the currency to bearish in the medium-term. Looking at a weekly chart, the currency is trading within normal conditions. This is based on various technical indicators on the Canadian dollar currency index.