The recent global uncertainty and political tensions surrounding Iran have led to surge in the price of oil and we saw U.S crude oil futures gain 3% over the course of trading yesterday following the U.S decision to abandon a nuclear deal with Iran.
This news has managed to take away some of the weakness for Canadian Dollar exchange rates and has countered the uncertainty over the NAFTA agreement that has been weakening the Canadian Dollar in recent weeks.
With oil being one of Canada’s major exports oil price movements can impact the price of the Canadian Dollar, a rising oil price is generally seen as positive for the Canadian Dolar and a drop in oil prices can be seen as a negative.
We will no doubt have a lot more to come from this story and I am sure that this will continue to impact the price of the Canadian Dollar in days and weeks to come.
The next key piece of economic data from Canada will be out tomorrow where we will have unemployment rates followed by a speech from the Senior Deputy Governor of the Bank of Canada later in the afternoon, unemployment is currently expected to have remained at 5.8% so any change from those expectations could lead a an afternoon of volatility for the Canadian Dollar. The net change in employment is expected to have slightly dropped from the figure last month.
As mentioned at the top end of this report the main focus in my opinion for the coming week or so will be movements in Iran, further uncertainty could lead to further Canadian Dollar strength and a move to a more peaceful outcome could quite quickly weaken the Canadian Dollar off again.
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