Skip to main content

Featured

Gas Prices Are Finally Falling in Canada — Here's How Much You're Saving and What Comes Next

After weeks of painful price spikes driven by the U.S.-Iran conflict, Canadians are finally catching a break at the pump. The national average gas price dropped to 169.1 cents per litre on Monday, April 20 — down from a peak near 198 cents — as two things happened at once: Iran reopened the Strait of Hormuz to commercial traffic, and Prime Minister Mark Carney's federal fuel excise tax suspension came into effect. National Average 169.1¢/L ▼ Down from ~198¢/L peak Gas savings (excise tax) 10¢/L off gasoline until Sept. 7 Diesel savings 4¢/L off diesel until Sept. 7 WTI Crude (current) ~$87 ▼ Down from $120 peak What just happened — and why Since the U.S.-Iran conflict began in late February, Brent crude surged more than 55%, briefly topping $120 a barrel — the largest oil supply shock in the history of global markets, according to the Interna...
Post a Comment
Read more

article

Labels

Loonie gains as oil prices climb and Fed rate hike seen unlikely

The Canadian dollar edged higher against its U.S. counterpart on Monday as oil prices rose and investors bet that the Federal Reserve would not raise interest rates at a meeting this week.

The loonie was trading 0.2% higher at 1.3565 to the greenback, or 73.74 U.S. cents, after moving in a range of 1.3548 to 1.3590. Last week, the currency touched its weakest in nearly five weeks at 1.3599.

Oil prices climbed on Monday, supported by expectations of tighter supply and signs of economic recovery. Canada is a major exporter of crude oil, so the loonie tends to benefit from higher oil prices.

Investors were also looking ahead to the Fed’s policy decision on Wednesday, which is widely expected to deliver a rate hike of 50 basis points, the first since 2018. However, some analysts said the Fed could signal a pause in its tightening cycle amid signs of slowing growth and inflation in the U.S.

“The market is pricing in a very dovish Fed, which is supportive for the Canadian dollar,” said Bipan Rai, North American head of FX strategy at CIBC Capital Markets. “The Fed is likely to acknowledge the downside risks to the outlook and may hint at a slower pace of rate hikes next year.”

Rai said he expected the loonie to strengthen to 1.33 per U.S. dollar by the end of the year, as the Bank of Canada (BoC) maintains its hawkish stance. The BoC has raised its benchmark rate four times this year to 4.25%, the highest in nearly 15 years, and has said it will study the most recent economic data to gauge whether to hike further.

The Canadian dollar was also supported by domestic data that showed the value of building permits rose by 2.5% in October, beating market expectations of a 0.5% decline.

Canadian government bond yields rose across the curve, tracking the move in U.S. Treasuries. The 10-year was up 3.4 basis points at 2.916%.

Labels:

Comments

Post a Comment