The Canadian Dollar has only managed to grow against the US Dollar today, but fell against all its other counterparts due to the fact that traders are looking for higher yielding assets on the market. The growth against the US Dollar can be explained through the fact that the trading sentiment is improving, making investors willing to risk a little bit more. On the other hand, the currency fell against the Euro and the Japanese Yen, which are higher-yielding assets than the Canadian Dollar.
We can notice that the Producer Price Index in the US, which is the most important trading partner of Canada, has increased by 0.2 percent during the month of July, after it has previously fallen by 0.4 percent during the month of June. Due to the global economic situation, market analysts were expecting no change, so this growth actually came as a surprise which has helped to the improvement of the Canadian Dollar’s situation. Read more »