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Market news: Explosions were heard at a US military base in Saudi Arabia.Security sources say a drone strike hit the U.S. embassy in Baghdad, with explosions heard at the scene.Berlin Brandenburg Airport will be completely closed on Wednesday as a planned labor strike could lead to the cancellation of all flights and disrupt the travel plans of more than 50,000 passengers.Dongfeng Motor Group Co., Ltd. (00489.HK): The Company has applied to the Stock Exchange of Hong Kong, and the Stock Exchange of Hong Kong has approved, the delisting of the H shares from the Stock Exchange of Hong Kong with effect from 4:00 p.m. on Wednesday, March 18, 2026.1. The three major U.S. stock indexes closed slightly higher. The Dow Jones Industrial Average rose 0.1% to 46,993.26 points, the S&P 500 rose 0.25% to 6,716.09 points, and the Nasdaq Composite rose 0.47% to 22,479.53 points. IBM rose more than 2%, and Disney rose more than 1%, leading the Dow Jones. Drone manufacturer Swarmer surged 520% on its first day of trading in the U.S. The Wind U.S. Tech Giants Index rose 0.43%, with Google and Amazon rising more than 1%. The Nasdaq China Golden Dragon Index fell 0.73%, with Tencent Music falling more than 24% and Wanwu Xinsheng falling nearly 5%. The market continues to focus on the impact of the U.S.-Iran war on crude oil and other factors. 2. The U.S. crude oil futures contract closed up 2.7% at $96.02 per barrel; the Brent crude oil futures contract rose 3.35% to $103.57 per barrel. 3. International precious metals futures closed mixed. COMEX gold futures rose 0.18% to $5011.30 per ounce, while COMEX silver futures fell 1.51% to $79.46 per ounce. 4. Most London base metals fell. LME lead rose 1.10% to $1926.0 per tonne, LME copper fell 0.59% to $12780.0 per tonne, LME aluminum fell 0.91% to $3364.5 per tonne, LME zinc fell 1.12% to $3233.0 per tonne, LME nickel fell 1.20% to $17255.0 per tonne, and LME tin fell 2.93% to $46850.0 per tonne.

USD/CAD declines to 1.3500 on firmer Oil prices, BoC concerns over US inflation, and Fed Minutes

Daniel Rogers

Apr 10, 2023 14:35

 USD:CAD.png

 

The USD/CAD maintains losses close to 1.3500, shattering a four-day winning trend, as traders brace for key Easter Monday data/events on major bourses. However, the recent decline in the Loonie-U.S. dollar exchange rate may be due to the increase in the price of WTI petroleum oil, Canada's primary export. In contrast to the recent increase in ardent Fed forecasts, the Bank of Canada's (BoC) dovish bias poses a challenge to pair sellers.

 

After increasing for three consecutive weeks, WTI crude oil prices gain 0.61 percent intraday near $80.00. Recent increases in the price of black gold may be due to geopolitical concerns surrounding China and Taiwan. In addition to the supply cut by OPEC+ and the faltering US dollar, the energy benchmark is sustained by the supply cut by OPEC+ and the weakening US dollar.

 

However, the US Dollar Index (DXY) has fallen for three consecutive weeks and is under pressure near 102,000.

 

Fears of higher Fed rates versus inaction from the Bank of Canada (BoC) grew after the upbeat US Jobs report versus the lack of significant positives in the March Canadian jobs report.

 

As a result, the CME's FedWatch Tool indicates a 69% chance of a 0.25 basis point rate hike in May, up from 55% prior to the US employment report.

 

Canada's headline Net Change in Employment increased to 34.7K in March from 21.8K in February, compared to the market consensus of 12K, while the Unemployment Rate came in at 5% versus the analysts' estimate of 5.0%. During the specified month, the Participation Rate decreased to 65.6% from the expected and previous rate of 65.7%. In addition, the average hourly wage fell 5.2% year-over-year in March, down from 5.5% in February.

 

In contrast, the US Bureau of Labor Statistics (BLS) reported that Nonfarm Payrolls (NFP) increased by 236K in March, the lowest increase since January 2021 (considering revisions), compared to the expected 240K and the previous 330,000. Additionally, the unemployment rate fell from 3.6% to 3.5%, while the labor force participation rate rose from 62.6% to 62.6%. The annual wage inflation rate decreased from 4.6% to 4.2%, below market expectations of 4.3%.

 

Futures on US equities ended higher, but yields remain under pressure ahead of the crucial BoC monetary policy meeting, US inflation, and Fed Minutes. Given the dovish concerns from the Bank of Canada (BoC) and the likely hawkish comments in the FOMC Minutes, the USD/CAD may see additional gains, barring any unexpected developments.


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