Canadian Dollar holds gains as US Dollar struggles on easing safe-haven demand
USD/CAD gains ground after opening at a bearish gap, remaining in negative territory and trading around 1.3970 during Asian hours on Monday.
The Canadian Dollar (CAD) has managed to gain ground as the US Dollar (USD) faces challenges due to easing safe-haven demand. This trend can be attributed to ongoing diplomatic efforts to resolve the Middle East conflict, with talks continuing between Qatari and Iranian officials, aiming to reach an agreement before the US midterm elections.
However, the USD/CAD pair remains under pressure due to falling oil prices, which could negatively impact the Canadian Dollar. Meanwhile, the US Dollar may rebound as traders anticipate a potential Federal Reserve rate hike, driven by strong US economic data and persistent inflation. Investors are also closely watching key economic events such as the US Nonfarm Payrolls (NFP) report and ISM manufacturing and services data.
Overall, the Canadian Dollar's performance is influenced by interest rates set by the Bank of Canada, oil prices, the health of Canada's economy, inflation, and the Trade Balance. With the US economy being Canada's largest trading partner, its health also plays a significant role in determining the CAD's value.
Written by urgent.news from FXStreet's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
