Loonie comes alive
USDCAD is on the move. It languished on the sidelines for four days, locked in a tight 1.3280-1.3360 range, but that changed this morning.
Head of Commodity Strategy
Summary: The Fed- and China-fueled risk rally has boosted commodity prices despite evidence of a global slowdown.
Crude oil posted its strongest monthly advance since 2015 but despite multiple events and comments providing support it failed to break higher. Having been rangebound for the past three weeks, the short-term direction could be lower as both WTI and especially Brent continue to consolidate within the established $5 ranges. During the past week, the following comments and events failed to give oil the needed boost to break higher.
• US sanctions against PdVSA potentially reducing crude oil exports further
• Saudi Arabia said in an interview that it would cut February production below its voluntarily agreed limit at 10.33m b/d
• The Fed joined other central banks in turning more dovish thereby supporting the growth and demand outlook.
• US weekly crude oil inventories rose by less than expected as Saudi Arabia cuts supplies
• Stabilising risk sentiment with trade talks between China and the US appearing to gain some momentum
WTI crude oil is currently stuck in a $50/b to $55.50/b range.