USDCAD Tumbles to Two-week Lows as Oil Edges Higher While Dollar Hit By Fed
Canadian dollar soared to the highest level in more than two weeks versus its American counterpart on Thursday, supported by a rising crude price while the dollar lost ground after Fed raised rate but signaled no pick-up in the pace of tightening.
The pair USDCAD dropped to as low as 1.32800 as the dollar weakened broadly against most of its peers even after the Federal Reserve hiked interest rates by 25 basis points to a range of 0.75 percent to 1.00 percent. This was the second rate hike in three months, a move supported by steady economic growth, strong job gains and prospect that inflation is heading towards the central bank’s target goal.
However, Fed did not signal any plan to accelerate the pace of monetary tightening with Fed Chair Janet Yellen emphasizing that future rate increases would be “gradual.”
Meanwhile, crude oil futures prices extended its rally in early European trading hours on Thursday after official data on Wednesday showed U.S. inventories had eased from record highs. Weekly data published by the U.S. Energy Information Administration (EIA) showed U.S. crude stocks fell 237,000 barrels in the week to March 10, which was in a marked contrast to analysts’ forecast for an increase of 3.7 million barrels.
Sell Stop at 1.32800, Take profit 1.32200, Stop loss at 1.33100