On Thursday (June 13), during the early session in New York, the Bank of Canada stated that the overall risks facing the financial system remain high but have somewhat diminished, while also noting that there have been encouraging changes in the housing market. The overall tone from the central bank is optimistic, but the dollar to Canadian dollar (1.0166,0.0010,0.10%) reaction is mild, hovering just above the recent one-month low of 1.0149. Initially, both U.S. retail and initial jobless claims data were positive, but the boost to the dollar to Canadian dollar was limited. Overall, the decline in the exchange rate is driven by a significant drop in the dollar to yen (94.69,-0.9200,-0.96%).
The Bank of Canada stated that the overall risks facing the Canadian financial system remain very high, but have diminished over the past six months; additionally, the risks from the Eurozone crisis remain very high, but have also somewhat eased.
The bank also indicated that the risks from high household debt and elevated housing prices remain substantial, but have eased compared to December of last year; household debt levels have generally increased in line with disposable income, and there have been encouraging changes in the housing market.
From a technical perspective on the daily chart, the dollar to Canadian dollar has broken below the 100-day moving average support at 1.0180. If it closes below this price, the exchange rate is expected to continue to retrace, targeting the 1.100 level.
As of 23:06 Beijing time, the dollar to Canadian dollar is quoted at 1.0167/70.