USD/CAD extended its seven-session fall Friday, leaving the Canadian dollar near a one-month high; Reuters linked Thursday’s rise to firmer oil and a smaller Canada-U.S. yield spread.
FXStreet put the pair near C$1.4000 in Asian trading Friday, Oct. 23. Reuters said the Canadian dollar reached C$1.4007 Thursday, up 0.3% and its strongest intraday level since Sept. 21. The Bank of Canada’s reference rate stood at C$1.4021 per U.S. dollar Oct. 22, compared with C$1.4154 on Oct. 16. Those official rates are daily references, not intraday trading quotes.
Yields on Canada’s two-year debt moved closer to their U.S. counterparts, Reuters reported, with the spread narrowing by 11 basis points to about 141 basis points. U.S. notes still offered the higher yield. Convera FX and macro strategist Kevin Ford told Reuters the smaller gap reduced the U.S. dollar’s advantage from interest rates, while higher oil prices improved Canada’s trade position.
Oil prices rose Thursday amid concern that attacks in Saudi Arabia could disrupt supply. Reuters reported U.S. crude futures gained 2.2% to $99.26 a barrel that day. In early trading Friday, West Texas Intermediate (WTI) was down 0.3% at $98.12 a barrel, while Brent fell 0.2% to $112.96 a barrel.
Saudi Arabia’s General Authority of Civil Aviation said an attack on King Fahd International Airport in Dammam on Oct. 21 killed two people and injured eight. The authority did not identify the attacker; The Associated Press (AP) reported that the Houthis claimed responsibility.
U.S. stocks also fell Thursday. AP reported the S&P 500 lost 1.2% and the Nasdaq Composite dropped 2.6%; Meta shares fell 7% and Tesla shares declined 3.1%. AP linked pressure on technology shares to the financing costs of data-center expansion and AI chip purchases, as well as questions about valuations. Earnings reactions were mixed: AP said Meta’s revenue beat analyst expectations but its profit missed, while Tesla’s profit beat and its revenue fell short.
The Federal Open Market Committee is scheduled to meet Oct. 27-28. The Bank of Canada will announce its rate decision and release its Monetary Policy Report Oct. 28 at 9:45 a.m. ET.
