- USD/CAD has slid back from European morning session highs in the 1.2780s to test the 1.2700 level.
- CAD has been lagging the likes of NZD, GBP and AUD, likely due to softness in crude oil markets.
USD/CAD has slid back from European morning session highs in the 1.2780s to test the 1.2700 level again, as the loonie benefits from weakness in safe-haven currencies (including the US dollar) amid a broad recovery in risk appetite since the start European session. Currently, the pair trades with losses of around 0.3% or 30 pips on the day.
Driving the day
In terms of the reasons as to why sentiment has taken a positive turn for the better and USD has fallen; positive vaccine news is likely helping. Moderna announced last night that it was to start investigating a booster vaccine shot (to come 6-12 months after the second dose) and Pfizer is also to look into a booster dose. Meanwhile, after the release of a decent earnings report, the Johnson & Johnson (J&J) CFO said that they expect to release Covid-19 vaccine trial data next week and that the company is very optimistic that they will be releasing a very robust data set. J&J’s vaccine is being touted as a “game-changer” in the vaccination race as it would only require one shot to acquire full immunity.
This has benefitted the loonie versus its safe haven G10 FX counterparts. However, CAD has been lagging the likes of NZD, GBP and AUD, likely due to the fact that crude oil markets have not picked up in line with risk appetite; the crude oil complex is struggling with the risks posed to near-term demand by increasingly stringent global travel crackdowns as countries take action to prevent the international spread of new variants of Covid-19.
Note: All information on this page is subject to change. The use of this website constitutes acceptance of our user agreement. Please read our privacy policy and legal disclaimer. Opinions expressed at FXstreet.com are those of the individual authors and do not necessarily represent the opinion of FXstreet.com or its management. Risk Disclosure: Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.
Recommended content
Editors’ Picks
EUR/USD stays near 1.0400 in thin holiday trading
EUR/USD trades with mild losses near 1.0400 on Tuesday. The expectation that the US Federal Reserve will deliver fewer rate cuts in 2025 provides some support for the US Dollar. Trading volumes are likely to remain low heading into the Christmas break.
GBP/USD struggles to find direction, holds steady near 1.2550
GBP/USD consolidates in a range at around 1.2550 on Tuesday after closing in negative territory on Monday. The US Dollar preserves its strength and makes it difficult for the pair to gain traction as trading conditions thin out on Christmas Eve.
Gold holds above $2,600, bulls non-committed on hawkish Fed outlook
Gold trades in a narrow channel above $2,600 on Tuesday, albeit lacking strong follow-through buying. Geopolitical tensions and trade war fears lend support to the safe-haven XAU/USD, while the Fed’s hawkish shift acts as a tailwind for the USD and caps the precious metal.
IRS says crypto staking should be taxed in response to lawsuit
In a filing on Monday, the US International Revenue Service stated that the rewards gotten from staking cryptocurrencies should be taxed, responding to a lawsuit from couple Joshua and Jessica Jarrett.
2025 outlook: What is next for developed economies and currencies?
As the door closes in 2024, and while the year feels like it has passed in the blink of an eye, a lot has happened. If I had to summarise it all in four words, it would be: ‘a year of surprises’.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.