The Canadian dollar is mostly lower today, despite overall weakness in the US dollar. The loonie is currently the weakest against the British pound, the Australian dollar and the Japanese yen. The Canadian dollar is flat against the US dollar. Since we wrote our crude oil daily update earlier today, crude oil prices are now trading lower. For now, CAD appears to be tracking crude oil prices lower, despite overall weakness in the US dollar. Over the weekend, we wrote that the outlook for the Canadian dollar has been weakening thanks to tough NAFTA talks, transportation issues affecting the country's crude oil industry, and a weakening pace of GDP growth. The currency's performance in 2018 has been fairly disappointing, and we expect to downgrade our medium-term outlook on the Canadian dollar to neutral over the coming weeks. Despite a continuation of the US dollar bear market, the loonie is underperforming its peers. Our short-term outlook on the currency remains neutral, while our medium-term outlook is bullish.
The USD/CAD exchange rate is currently above 1.2630. The euro is up against the Canadian dollar, with EUR/CAD currently above 1.5580. The pound is up against the Canadian dollar, with GBP/CAD trading above 1.7740.
This is a fairly light week for Canadian economic data. On Wednesday, we'll see the raw material price index. On Thursday, we'll see the current account and Markit manufacturing PMIs. On Friday, we'll see December GDP figures. The GDP numbers will be watched closely following disappointing December retail sales numbers last week.
As the Canadian dollar strengthens, we are upgrading the currency to bullish 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.