USD/CAD loses traction, drops toward 1.2270 as USD struggles to find demand
- USD/CAD pair came under modest bearish pressure during American session.
- US Dollar Index fell below 91.00 with US T-bond yields pushing lower.
- WTI rises above $64 after staying quiet earlier in the day.
After trading around 1.2300, the USD/CAD pair came under modest selling pressure in the early trading hours of the American session and dropped to 1.2270 area. As of writing, the pair was posting small daily losses at 1.2283.
USD selloff intensifies
The broad-based selling pressure surrounding the greenback seems to be forcing USD/CAD to edge lower. Following Friday's impressive upsurge, the US Dollar Index turned south on Monday and was last seen losing 0.45% at 90.90. The more-than-2% decline seen in the benchmark 10-year US Treasury bond yield is putting additional weight on the USD's shoulders.
Moreover, Wall Street's main indexes are up between 0.6% and 0.9%, making it difficult for the greenback to attract investors as a safe haven.
The Markit Manufacturing PMI in Canada fell to 57.2 in April from 58.5 in March but failed to trigger a significant market reaction. On the other hand, the ISM Manufacturing PMI in the US declined to 60.7 from 64.7, missing the analysts' estimate of 65.
In the meantime, the barrel of West Texas Intermediate (WTI), which stayed relatively quiet around $63.50 during the first half of the day, is currently rising more than 1% at $64.30, helping the commodity-sensitive CAD preserve its strength.
Later in the session, FOMC Chairman Jerome Powell's speech will be watched closely by market participants.
Technical levels to watch for