USD/CAD edges lower toward 1.33 as WTI continues to climb above $64
- Crude oil rally continues on Wednesday.
- US Dollar Index posts small daily losses below 97.
- Coming up: Inflation report from the U.S. and FOMC meeting minutes.
Following the sharp fall witnessed on Monday, the USD/CAD pair seems to be struggling to find a firm direction. With crude oil extending its rally to a fresh 2019 high above $64 today, the commodity-sensitive loonie gathered modest strength against its rivals. As of writing, the pair was trading at 1.3325, losing 0.03% on a daily basis.
Earlier in the day, the UAE's energy minister said that OPEC+ output levels could change depending on the markets' need and supported crude oil prices ahead of the weekly EIA report. At the moment, the barrel of West Texas Intermediate is trading at its highest level since late October of 2018 at $64.37, gaining around 15 cents on the day.
On the other hand, investors are refraining from making large bets while waiting for today's key macroeconomic events. At the start of the NA session, inflation report from the U.S. will be published before the FOMC releases the minutes of its March meeting later in the evening.
Previewing today's events, "For core CPI, we expect a weak 0.2% m/m print to leave annual core inflation at 2.1%, as OER is likely to moderate this month. Our forecasts suggest core PCE inflation is likely to slow to 1.7% by March,” TD Securities analysts said.
"Separately, after the sharp drop in the dots, markets will be looking at just how dovish the FOMC has become in the release of the March minutes on Wednesday."
Technical levels to consider