Canadian dollar wavers ahead of the Bank of Canada decision
The price of crude oil declined after another increase of US inventories. According to the American Petroleum Institute (API), the number of inventories rose by more than 12.79 million barrels last week. This was an increase from the previous week’s 7.8 million barrels. The Energy Information Administration (EIA) will publish its weekly numbers later today. Analysts expect them to show that the number of inventories increased by 816,000 barrels. The crude oil price has been under pressure since Monday when it reached its two-and-a-half-year high.
The Canadian dollar moved sideways ahead of the Bank of Canada (BOC) interest rate decision that will come out later today. Economists expect the bank to leave interest rates at 0.25% and to continue with its asset purchases. The decision comes at a time when the Canadian economy is on a recovery path from the pandemic. Recent numbers, including the overall retail sales, inflation, and manufacturing production have been relatively positive.
The US dollar index rose against its peer currencies in the overnight session as traders waited for the February consumer price index (CPI) data. Economists polled by Reuters expect the data to show that the overall CPI increased by 0.4% in February, leading to an annual increase of 1.7%. This will be the highest inflation since the coronavirus pandemic started. They also see the core consumer price index rising by 1.5% after rising by 1.4% in the previous month.
The EUR/USD declined from yesterday’s high of 1.1917 to 1.1882. On the four-hour chart, the price is still slightly below the 15-period moving average while the Stochastic oscillator has started to drop. Also, the signal and histogram of the MACD have already made a bullish crossover. Therefore, the pair may resume the downward trend as bears target yesterday’s low at 1.1833.
The XBR/USD price is declining for the second straight day after high US inventories. On the four-hour chart, the price is at important support since this price was at the highest level on February 25. It is also slightly above the ascending yellow trendline. Further, the MACD and the RSI have made bearish reversals. Still, the overall trend is bullish when the price is above the ascending yellow trendline.
The USD/CAD pair rose slightly ahead of the BOC decision. The pair is trading at 1.2667, which is higher than yesterday’s low of 1.2595. On the hourly chart, this price is also slightly above the short and longer moving averages while the Average True Range (ATR) has declined. The Relative Strength Index (RSI) has also continued to rise. Therefore, the pair may continue rising as bulls target the next resistance at 1.2685.