USD/CAD struggles to capitalize on BoC's upbeat outlook, trades around 1.3050
- BoC says business sentiment was broadly positive in Q4.
- WTI drops to fresh monthly lows near $58.
- US Dollar Index struggles to push beyond 97.50.
The USD/CAD pair fluctuated in a 20-pip range with the initial reaction to the Bank of Canada's (BoC) Business Outlook Survey but struggled to make a decisive move in either direction. As of writing, the pair was virtually unchanged on the day at 1.3050.
In its latest publication, the BoC noted that the business sentiment in the fourth quarter remains broadly positive. Regarding the inflation outlook, the bank noted that expectations were unchanged. "The majority of firms still anticipate inflation will be in the lower half of the bank's target range of 1% to 3%," the publication read.
Oil prices continue to push lower
Despite the BoC's relatively upbeat tone, the ongoing crude oil selloff made it difficult for the CAD to gather strength. As of writing, the barrel of West Texas Intermediate (WTI) is trading at $58.20, losing 1.5% on the day. Heightened hopes of a ceasefire in Libya seems to be weighing on crude oil prices on Monday.
On the other hand, the US Dollar Index struggled to break above the 97.50 mark and turned flat near 97.30 during the American session, not allowing the pair to gain traction. There were no macroeconomic data releases from the US on Monday and the greenback largely ignored Boston Fed President Eric Rosengren, who said that policymakers were anticipating an "almost ideal outcome in 2020 of a strong labour market and inflation near 2% target."
Technical levels to watch for