The George Davis Report: August 2019 Edition

By George Davis
Published August 20, 2019 | 3 min watch

A monthly video series on the trajectory of the Canadian dollar

In this edition of the George Davis report, George discusses how a recent policy divergence has allowed the U.S. dollar to trade down to a new 9-month low and the impact of lingering and new trade uncertainty on the Canadian dollar.   

 

What you need to know

1

Central bank policy divergence pushed USD/CAD to a 9-month low of 1.3016 in mid-July.

2

However, new tariff threats have offset the impact of policy divergence as trade uncertainty increases.

3

This uncertainty is now likely to place a floor under USD/CAD near 1.3000.

4

Oil prices remain a key driver for the Canadian dollar, followed by equity markets.

5

These variables will have to be watched closely as the trade uncertainty plays out.

Hedging Strategies

USD/CAD

Buyers

1.3000 – 1.3100

Sellers

1.3400 – 1.3500

This video is part of our monthly George Davis Report series, with ad hoc reports brought to you as current.

© RBC Capital Markets, LLC, RBC Dominion Securities Inc., RBC Europe Limited 2018 


George Davis
Chief Technical Strategist, FX Trading, Strategy & Sales, RBC Capital Markets


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