- USD/CAD Weakens as Oil Prices Climb, Boosted by Renewed Expectations of Federal Reserve Policy Easing.
- Canadian Prime Minister Justin Trudeau has no plans to step down during the Christmas holidays.
- The US Dollar faces pressure as weaker US PCE data reignites optimism for potential rate cuts by the Federal Reserve in the coming year.
The USD/CAD pair continues its downward trend for the third consecutive session, hovering around 1.4360 during Monday’s Asian trading hours. As Canada is the largest oil exporter to the United States, the Canadian Dollar (CAD) is gaining strength, supported by rising crude oil prices. This increase follows US data showing signs of cooling inflation, reigniting expectations of further policy easing in 2024. This could support global economic growth and drive higher oil demand.
In Canadian politics, Prime Minister Justin Trudeau has no intention of resigning during the Christmas break, as reported by the Globe & Mail. Despite leading a minority government, opposition parties have vowed to introduce a no-confidence motion when Parliament resumes in six weeks, potentially triggering an election.
In the United States, President-elect Donald Trump has made several key appointments to his administration. Scott Bessent will lead the Treasury Department, Howard Lutnick will become the Commerce Secretary, and Kevin Hassett will head the National Economic Council. Other appointments include Andrew Ferguson as Chair of the Federal Trade Commission and Jacob Helberg, a senior advisor to Palantir CEO Alex Karp, as the nominee for Secretary of State for Economic Growth, Energy, and the Environment, according to Business Insider.
The US Dollar (USD) faces downward pressure following the release of softer-than-expected Personal Consumption Expenditures (PCE) data on Friday. The report showed that the core PCE inflation rose by 2.8% year-over-year in November, slightly below the forecast of 2.9%. On a monthly basis, core inflation increased by 0.1%, lower than the expected 0.2% and the previous 0.3%.”
