Canadian Dollar Rises As Falling Inventories Lift Oil Prices
May 10 2017 - 2:48AM
RTTF2
The Canadian dollar climbed against its major counterparts in
the European session on Wednesday, as oil prices slipped following
a larger than expected decline in U.S. crude stock piles and as
Saudi Arabia signaled a possible reduction in crude supplies to
Asian buyers in June.
Crude for June delivery rose $0.55 to $46.43 per barrel.
Data from the American Petroleum Institute showed that U.S.
crude oil inventories fell 5.8 million barrels last week, far
higher than forecasts for a 1.8 million barrel drop.
Official data from the U.S. Energy Information Administration is
due at 10:30 am ET, with analysts expecting a draw of 1.786 million
barrels in crude supplies.
Further aiding oil prices were a media report that Saudi Aramco
is planning to trim oil supplies to Asia by about 7 million barrels
in June. The reductions in June allocations are part of the
commitment to meet the OPEC deal to balance oil market.
The loonie showed mixed performance in the Asian session. While
the loonie dropped against the aussie and the euro, it held steady
against the greenback and the yen.
The loonie rose to 83.20 against the yen and held steady
thereafter. The next possible resistance for the loonie-yen pair is
seen around the 84.00 region.
Preliminary data from the Cabinet Office showed that Japan's
leading index rose to a 21-month high in March.
The leading index, which measures the future economic activity,
rose to 105.5 in March from 104.7 in February. This was the highest
since June 2015.
Reversing from an early low of 1.3733 against the greenback, the
loonie edged up to 1.3687. On the upside, 1.35 is likely seen as
the next resistance level for the loonie.
The loonie advanced to a 9-day high of 1.4878 against the euro,
off its early low of 1.4956. If the loonie extends gain, 1.47 is
possibly seen as its next resistance level.
On the flip side, the loonie slipped to 1.0123 against the
aussie, compared to 1.0072 hit late New York Tuesday. Further
downtrend may take the loonie to a support around the 1.03
mark.
Looking ahead, U.S. export and import prices for April are due
in the New York session.
At 12:00 pm ET, Boston Fed President Eric Rosengren delivers a
luncheon speech in South Burlington, Vermont.
The U.S. monthly budget statement for April is set for release
at 2:00 pm ET.
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