Commodity Currencies
The Canadian dollar has benefitted from stronger oil prices but dimming prospects for the economy has put a cap on the rally. The Bank of Canada (BOC) went from having a tightening bias at the start of the year to more of a wait and see approach, with financial markets pricing in the next move to be a rate cut. Rates are likely to remain below the bank’s neutral range as inflation is slightly below the mid-point of their target range and GDP remains soft.
The United States–Mexico–Canada Agreement (USMCA) has not yet been finalized and we could see this deal struggle to get through Congress or we could see President Trump scratch the deal. Any uncertainty on the trade deal could put pressure on both the loonie and Mexican peso.
The Australian dollar has been stuck in a range as markets ponder whether the Reserve Bank of Australia (RBA) will deliver a rate cut over the next couple of policy meetings. Dovishness has prevented the Aussie-dollar from seeing any major rallies on trade deal optimism between China and US. Even if we do see a rate cut by the RBA, we could see the improving global macroenvironment ultimately support a move higher for high-beta currencies.
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Ed Moya
His particular expertise lies across a wide range of asset classes including FX, commodities, fixed income, stocks and cryptocurrencies.
Over the course of his career, Ed has worked with some of the leading forex brokerages, research teams and news departments on Wall Street including Global Forex Trading, FX Solutions and Trading Advantage. Prior to OANDA he worked with TradeTheNews.com, where he provided market analysis on economic data and corporate news.
Based in New York, Ed is a regular guest on several major financial television networks including CNBC, Bloomberg TV, Yahoo! Finance Live, Fox Business, cheddar news, and CoinDesk TV. His views are trusted by the world’s most respected global newswires including Reuters, Bloomberg and the Associated Press, and he is regularly quoted in leading publications such as MSN, MarketWatch, Forbes, Seeking Alpha, The New York Times and The Wall Street Journal.
Ed holds a BA in Economics from Rutgers University.
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