Canadian Dollar Advances As Oil Prices Rally On Saudi Pledge To Cut Exports
24 July 2017 - 8:17PM
RTTF2
The Canadian dollar climbed against its major opponents in the
European session on Monday, as oil prices advanced after Nigeria
agreed to join the production cuts and the Saudi pledged to limit
crude exports in next month at a gathering of oil ministers in
Russia.
Crude for September delivery rose $0.20 to $45.97 per
barrel.
Speaking in St Petersburg, Saudi Arabia's energy minister Khalid
al Falih said the kingdom would cap its oil exports at 6.6 million
barrels per day in August, a decrease of 1 million barrels per day
year-on-year.
Saudi also demanded participation of all OPEC and non-OPEC
members in contributing their share of output caps as their
attempts failed to prop up prices.
"[We are] not going to allow other countries to free ride and
undercut the agreement…everyone needs to contribute," he said.
OPEC also secured production commitment from Nigeria, which has
been exempt from last year's pact, to join the deal and cap its
output when its production reach a sustained 1.8 million barrels of
oil per day.
Data from Statistics Canada showed that Canada's wholesale sales
rose 0.9 percent to a record high $61.6 billion in May. Sales were
up in six of the seven subsectors, representing 80% of total
wholesale sales.
The loonie showed mixed performance in the Asian session. While
the loonie fell against the yen and the aussie, it held steady
against the greenback and the euro.
The loonie rose to a 4-day high of 1.4557 against the euro, from
an early low of 1.4647. The loonie is likely to find resistance
around the 1.44 region.
Flash data from IHS Markit showed that the Eurozone private
sector started the third quarter on a solid footing but the pace of
growth slowed for the second successive month in July.
The composite output index fell to a 6-month low of 55.8 in July
from 56.3 in June. The reading was expected to drop marginally to
56.2.
The loonie advanced to more than a 1-year high of 1.2503 against
the greenback, from a low of 1.2552 of hit at 6:00 am ET.
Continuation of the loonie's uptrend may see it challenging
resistance around the 1.24 area.
The loonie rose back to 0.9940 against the aussie, from an early
low of 0.9982. The currency is on track to pierce a 6-day high of
0.9911 set early in the Asian session. If the loonie extends rise,
0.98 is likely seen as its next resistance level.
The loonie edged up to 88.75 against the yen, from an early near
a 2-week low of 88.17. The loonie is seen finding resistance around
the 89.00 area.
Figures from the Cabinet Office showed that Japan's leading
index increased less than initially estimated in May.
The leading index, which measures the future economic activity,
rose to 104.6 in May from 104.2 April. The reading for May was
revised down slightly from 104.7.
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