Business & Investment / CAD-Canadian dollar soars due to soaring oil prices

The Canadian dollar soared overnight. Soaring crude oil prices, adjustments to the US Federal Open Market Committee minutes, and “as expected” US inflation have led to a shift to more risky assets and a widespread depreciation of the US dollar.

The American Petroleum Institute (API) reported that US crude oil inventories increased by 5.3 million barrels and gasoline and distillate inventories fell sharply. Traders saw the news as a “washout” and focused on the latest Energy Information Administration (EIA) forecasts. The EIA predicts that US crude oil production will decline by 260,000 barrels / day in 2021, despite increased global demand.

The Canadian dollar also rose as the prices of other commodities rose. Gold (XAU / USD) broke through resistance of $ 1770.00, which had been holding back since the end of September, and rose to $ 1,800.39 in New York. Gold prices rose due to lower yields on US Treasuries and a weaker US dollar.

The Turkish lira was the worst performing currency overnight. President Erdogan has fired three central bank policymakers for opposition to the September 23 interest rate cut. Traders are not impressed with the monetary policy decisions directed by a man (Erdogan) who has only elementary school education.

Data from China’s Producer Price Index frowned a bit. PPIs surged to a new record of 10.7% in September due to rising energy costs. Some analysts warn that higher costs will soon be passed on to consumers.

The FOMC minutes proved to be non-event. A series of Fed policy makers after the September 22 meeting essentially confirmed that asset purchases would taper off by the end of the year. This is suggested by the FOMC statement and the current minutes.

Inflation in the US was a bit hotter than expected, but traders ignored the data as supply chain disruptions could have distorted the results.

The EUR / USD pair moved above the downtrend line from September 13th, rising from $ 1.1589 to $ 1.1624 due to improved risk tones. However, the EUR / USD is the worst performing G-10 major, and the dovish European Central Bank’s monetary policy outlook limits profits.

GBP / USD rose from $ 1.3659 to $ 1.3733. Comments against the Bank of England policymaker Silvana Tenreiro’s rate hike were ignored. She said the economy was weaker than the BoE predicted.

USD / JPY traded in the range 1113.22-113.59, with lower US Treasury yields limiting the rise on the top side.

The AUD / USD and NZD / USD have rebounded against the backdrop of improved risk sentiment. Australian employment data was mixed and ignored.

Today’s US data includes PPI and weekly unemployed billing.

Rahim Madhavji, President of, a Canadian currency exchange, offers Canadians better rates than banks. / CAD-Canadian dollar soars due to soaring oil prices / CAD-Canadian dollar soars due to soaring oil prices

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