USD/CAD: Canadian Dollar Surges Against Greenback on Poloz Comments

The US dollar gave back gains against the Canadian dollar after two consecutive bullish days. Risk sentiment turned slightly positive and Poloz hinted no change in the current monetary policy.

Risk appetite has slightly increased after positive trade headlines and reports that Beijing is “cautiously optimistic” on reaching a phase-one deal. China has also invited US officials for more talks, signaling that further progress in trade negotiations could soon be made. Markets reacted with increased demand for risk assets (NZD is overall a top-performer for the day), but the US dollar was also higher against most major currencies.

The Philly Fed Manufacturing Index gave another push to the greenback after the indicator showed that US manufacturing activity remained strong in November. The index came in at 10.4, beating market expectations of 7.0, and rising strongly from the previous month’s reading of 5.6.

On the Canadian side, Bank of Canada Governor Poloz delivered a speech in Toronto and said “We think we have monetary conditions about right”, lowering market expectations for a rate cut in December. Yesterday’s CPI data which held steady at 0.3% has also provided a signal that the BoC will likely stick to the current policy at their next meeting.

From a technical standpoint, the USD/CAD pair is reaching a short-term support level that aligns with the November 14 high of 1.3270. While the overall tone remains bullish, the US dollar could have difficulties to sustain gains in the coming period given the current trade deal developments.

The October 10 highs of 1.3345 act as a strong resistance to the upside, while a break below 1.3270 could see a retest of lower 1.32s. As of 2:40 p.m. London time, the pair traded at 1.3275. is a news site only and not a currency trading platform. is a site operated by TransferWise Inc. (“We”, “Us”), a Delaware Corporation. We do not guarantee that the website will operate in an uninterrupted or error-free manner or is free of viruses or other harmful components. The content on our site is provided for general information only and is not intended as an exhaustive treatment of its subject. We expressly disclaim any contractual or fiduciary relationship with you on the basis of the content of our site, any you may not rely thereon for any purpose. You should consult with qualified professionals or specialists before taking, or refraining from, any action on the basis of the content on our site. Although we make reasonable efforts to update the information on our site, we make no representations, warranties or guarantees, whether express or implied, that the content on our site is accurate, complete or up to date, and DISCLAIM ANY IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. Some of the content posted on this site has been commissioned by Us, but is the work of independent contractors. These contractors are not employees, workers, agents or partners of TransferWise and they do not hold themselves out as one. The information and content posted by these independent contractors have not been verified or approved by Us. The views expressed by these independent contractors on do not represent our views.