The Canadian dollar continues to sell off this weak on lower crude oil prices and strength in the US dollar. As crude oil prices weaken on rising North American supply, the Canadian dollar is selling off as a result. Looking at upcoming economic data, current account figures scheduled to be released today are unlikely to have a substantial impact on the currency. Instead, markets will be closely watching crude oil prices given today's OPEC event. The cartel is expected to extend supply cuts by another 9 months in order to support prices. At the last OPEC event earlier this year, crude oil prices fell sharply following the OPEC announcement. Our short-term outlook on the currency remains bearish.
The USD/CAD exchange rate is currently above 1.2880. The euro is flat against the Canadian dollar. EUR/CAD is currently above 1.5230. Lastly, the pound is up sharply against the Canadian dollar, with GBP/CAD trading above 1.730.
This week's economic data releases include a speech by Poloz later on Tuesday, current account figures on Thursday and GDP figures and unemployment numbers on Friday. GDP figures will be watched closely as recent economic data suggests that Canadian growth is slowing. Last week, CAD sold off following weak retail sales estimates.
As the Canadian dollar falls on lower rate hike expectations and weaker crude oil, 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.