The Euro to Canadian Dollar (EUR/CAD) exchange rate hit a session high of 1.413 on Tuesday.
The Euro to Canadian Dollar (EUR/CAD) exchange rate is trading close to its best level in a week as the single currency found support from expectations that Greece will remain in the Eurozone and as a Swiss National Bank official said that it was ready to intervene in the currency markets.
Concerns over a possible Greek exit from the Eurozone were eased as finance ministers from across the 19-member Eurozone and wider European Union said that they were willing to negotiate with the New Greek government over the nation’s bailout but only if it ditches its demand for a debt reduction.
The Euro also found support from speculation that the Swiss National Bank may intervene in the markets in order to soften the Franc which shot higher in value following the banks surprise decision to ditch its exchange rate cap with the Euro.
‘The move on Euro-Swiss is grabbing attention. It is generating a bigger Euro move. It is unclear, but obviously, there is going to be a lot of discussion around what the SNB is going to do nest. I don’t think there’s enough here to suggest any clear influence,’ said Ian Stannard, head of forex at Morgan Stanley.
Oil and volatility weaken ‘Loonie’
The ‘Loonie’ meanwhile fell as concerns over falling oil and commodity prices continued to weigh heavily on the currency.
Last week’s surprise decision by the Bank of Canada to cut interest rates and increasing market volatility was also weakening the currency.
‘So far in 2015, oil prices and bond yields have continued to fall, and many central banks have enacted further monetary stimulus to stave off the risk of deflation, For Canada, the Bank of Canada’s 25-basis-point rate cut takes the cake as the biggest economic surprise of 2015. Moreover, it’s only January. While most economists, ourselves included, had been rapidly downgrading Canada’s economic outlook in the wake of the collapse in oil prices, none predicted that the Bank of Canada would react so swiftly to oil’s plunge,’ said economists from Toronto-Dominion Bank.
US Data weakens US Dollar (USD) Exchange Rate
The US Dollar weakened against the Euro after economic data out of the world’s largest economy showed that orders for long lasting manufactured goods dropped steeply in December.
According to the Commerce Department, durable goods orders fell by -3.4%, adding to the -2.1% fall recorded in November.
The cause for the sharp decline was a huge 55.5% reduction in demand for commercial aircraft.
Euro Exchange Rates:
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