USD/CAD renews intraday low near 1.2870 heading into Monday’s European session. In doing so, the Loonie pair takes clues from the upbeat prices of crude oil, Canada’s key export item. However, mixed sentiment and the US dollar moves appear to challenge the bears ahead of important data/events.
That said, the WTI crude oil remains mildly bid at around $106.50, stretching the previous weekly gains, suggesting the Group of Seven (G7) leaders prepare to take moves against Russian gold and oil.
It’s worth noting, however, that the fears surrounding China probe the oil buyers and challenge the USD/CAD bears. The White House said, per Reuters, “The US is confident that NATO’s new strategy document will include “strong” language on China, a White House official said on Sunday, adding that negotiations on how to refer to Beijing were still underway.”
Elsewhere, statements from the Bank for International Settlements (BIS) add to the risk-off mood and restrict the US dollar’s downside, which in turn tests the USD/CAD sellers. “Bank for International Settlements (BIS) calls for interest rates to be raised “quickly and decisively” to prevent the surge in inflation from turning into something even more problematic,” said Reuters.
However, fears surrounding the US recession, highlighted by International Monetary Fund (IMF) Managing Director Kristalina Georgieva, keep the USD/CAD sellers hopeful.
While portraying the mood, the S&P 500 Futures remain firmer around 3,920, up 0.20% intraday by the press time, whereas the US 10-year Treasury yields rise three basis points (bps) to around 3.15% after posting the first weekly loss in four.
Given the upbeat oil prices and the US dollar’s indecision, the USD/CAD is likely to remain pressured. However, today’s US Durable Goods Orders and Pending Home Sales for May will be important for intraday directions. Forecasts suggest that the US Durable Goods Orders for May, expected 0.1% versus 0.5% prior, as well as the Pending Home Sales, expected -2.0% versus -3.9% prior. Above all, Wednesday’s debate of the US and the UK and the European central bankers at the ECB Forum on Central Banking will be an important event to watch.