The Canadian Dollar touched a 5-month peak versus the US Dollar yesterday, in part due to a rise in oil prices, but also because of higher domestic yields. The bond yields rise, as well as gains for the Canadian Dollar, began on Wednesday when Stephen Poloz, the Governor of the Bank of Canada, made hawkish comments which have prompted investors to bet on a rate increase in the next month. Only last Friday, when inflation data was unexpectedly subdued, those bets were at 20% but have since risen to a 44% likelihood.
As reported at 10:20 am (JST) in Tokyo, the USD/CAD was trading lower at C$1.298, down 0.17% and just off the session low of C$1.297 while the session peak stands at C$1.3011. The EUR/CAD was trading at C$1.48491, down 0.19% and midway between pair’s low and high at C$1.48279 and C$1.48769.
Oil and China News Help Aussie and Kiwi
The rise in oil prices also helped to lift the Aussie and Kiwi Dollars, which are commodity-linked currencies. The AUD/USD was higher at $0.7699, a gain of 0.1925% while the NZD/USD was higher at $0.7320, up 0.2489%. Unexpectedly upbeat PMI data from China has also helped to lift the Aussie and Kiwi Dollars; the NBS Manufacturing PMI for June was 51.7, against expectations of a decline to 51.0.