USD/CAD briefly fell below 1.1000 after the jobs reports on Friday but later bounced. A second test of the key psychological level is underway.
USD/CAD is down a half-cent today to as low as 1.1003 as strong risk appetite boosts demand for the Canadian dollar. USD/CAD is lower in 8 of the past 10 sessions but has only begun to bite into the large gains since the start of the year.
The pair stalled out almost precisely at the 50% retracement of the 2009-2011 decline.
USDCAD daily
The Canadian government releases details of the 2014/15 fiscal year budget later today. From the market’s perspective, the only thing that really matters is the promise to balance the budget next year and Finance Minister Jim Flaherty has repeatedly reassured markets that is forthcoming.