TORONTO — The Canadian dollar will be looking for some direction Wednesday, with no major economic data slated to be released.
The loonie was ahead 0.13 of a cent to 91.84 cents US as commodities such as gold and oil continued to enjoy a bump in prices.
The benchmark U.S. July crude contract in New York jumped 14 cents US$104.49 a barrel ahead of a meeting by the Organization of the Petroleum Exporting Countries in Vienna. OPEC is expected to keep its output target of 30 million barrels a day unchanged.
“For months now, the OPEC basket price has been moving within a comfortable range of between $100 and $110 per barrel,” said analysts at Commerzbank in a note to clients. “There is no reason for the OPEC members to take any sort of surprising decision that would disturb this equilibrium, as this is the status quo that is preferred by all parties.”
The gain also came despite news that a group of Al Qaeda-inspired militants overran much of the Iraqi city of Mosul on Tuesday. Mosul is in an area that has been a major gateway for Iraqi oil.
Also adding to upward pressure on oil prices are the faltering talks on solving Ukraine’s gas payments to Russia as well as global indicators suggesting a pickup in growth in the second half of the year.
Meanwhile, the World Bank has said it’s planning on cutting its 2014 growth forecast to 2.8 per cent from 3.2 per cent, citing a bitter American winter and the political crisis in Ukraine. However, recent data such as solid U.S. hiring and stronger Chinese exports in May suggest prospects for growth in the second half of the year aren’t all pessimistic.
Camilla Sutton with Scotiabank said the loonie and U.S. dollar aren’t expected to make any major moves Wednesday.
“The USDCAD is trading in a tight range, lacking a fundamental catalyst to shift it in either direction,” said Sutton, chief FX strategist, managing director Scotiabank Global Banking and Markets in a note.
“Today there is no data in North America and no Fed (Federal Reserve) or BoC (Bank of Canada) speakers, leaving USDCAD likely in a quiet range,” Sutton said, referring to both the loonie and the U.S. dollar.
In other commodities, August bullion gained $4.10 to US$1,264.20 an ounce, while July copper fell two cents to US$3.04 a pound.