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USDCAD Broadly Keeps To Post US Data Hit, CAD Boosted By Oil

CANADA
  • USDCAD has crept higher after the slide on triple misses from US PMI, Richmond Fed and new home sales saw a low of 1.2934, currently 1.2964 (-0.7%) back at early Friday levels.
  • Linkages to the US had seen CAD underperform on crosses, e.g. AUDCAD temporarily moving back to mid-last week levels, but a continued move higher in WTI (currently +3.8%) has helped CAD claw some relative strength back.
  • Back to USDCAD, it cleared support at yesterday’s low of 1.2972 (Aug 22 low), opening firmer support at the 20-day EMA of 1.2913.
  • Front-end Can-US yield differentials have played relatively little role today, at +17bps vs recent highs closer to +20bps for levels seen in the first half of July.
  • Ahead, late Fedspeak from a Kashkari Q&A tonight plus usual sensitivity to any headlines with weaker China growth implications overnight before tomorrow’s US session sees further important drivers from preliminary durable goods for July with no Canadian data until Thursday.

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