The US dollar strengthened against the Canadian dollar early today, with the pair extending its weekly gains to hit 1.3710. This movement comes just before the release of Canada’s Retail Sales report and amid a recovery in West Texas Intermediate (WTI) prices, which have risen to $76.50. The increase in oil prices typically supports the Canadian dollar, known as the Loonie, but market fluctuations spurred by delays from OPEC+ have tempered gains.
Bank of Canada Governor Tiff Macklem has suggested that existing policies may be adequate for managing inflation, hinting at a potential pause in interest rate hikes. This stance mirrors that of the Federal Reserve, which has also indicated a possible halt to its aggressive rate increases, boosting risk-on sentiment that could exert downward pressure on the USD/CAD pair.
Meanwhile, the , which tracks the greenback against a basket of other major currencies, experienced an uptick to 103.80. This rise is supported by a surge in US Treasury yields, with the 10-year yield reaching 4.46% and the 2-year yield climbing to 4.94%. Investors are closely monitoring these developments as well as the anticipated slight downturn in November’s S&P Global PMI data for further insights into the health of key sectors within the US economy.
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