The Canadian dollar has posted slight gains in the Thursday session. Currently, USD/CAD is trading at 1.3054, up 0.06% on the day. On the release front, there are no Canadian indicators for the remainder of the week. In the U.S, the focus is on durable goods orders. Core durable goods orders is expected to climb to 0.5% and the durable goods orders is forecast to jump to 3.0%. Both indicators recorded declines in the previous release. On Friday, the U.S releases Advance GDP and UoM Consumer Sentiment.
Canadian policymakers are keeping a close eye on Wednesday’s breakthrough in the EU-U.S trade war. On Wednesday, EU Commission President Jean-Claude Juckner met with President Trump, and the talks appear to have been more successful than expected. The parties agreed to hold off on any further tariffs while talks are ongoing. This is a major concession from Trump, who had threatened to impose tariffs on European car imports. U.S tariffs on European aluminum and steel will remain in place, but Juckner pointed out that the U.S has agreed to reassess these measures. The surprise agreement eases fears of a full-blown transatlantic trade war. Will the goodwill displayed by Trump extend into some kind of agreement with Canada as well?
The Canadian dollar posted strong gains on Wednesday, following an Energy Information Administration report showed a huge decline of 6.1 million in U.S crude inventories. This is the second decline in three months, and was much higher than the estimate of 2.6 million. Tensions between Iran and the U.S have also raised concerns about oil supplies, and higher crude prices have boosted the Canadian dollar.
