The price of U.S. crude slipped below $47 during the night, its lowest level since the start of April. Rising production levels from the Middle East, specifically record production levels from Iraq, are once again tilting markets on the side of buyers. The loonie is staying essentially at the level it closed yesterday, a rare occasion where the CAD is not fluctuating in lockstep with crude oil prices. If energy markets continue to correct, then the CAD will most likely be forced to follow suit.
In economic news, this morning we are awaiting the release of inflation data in Industrial Product Prices in Canada (June). The markets are forecasting a relatively low inflation reading of 0.4% compared to 0.5% for May. It is highly likely that weak commodity prices -- the CRB Index is at its lowest level since June 2010 -- are partly responsible.
Have a good day!
- Range of the day: 1.2975 - 1.3075
Xavier Villemaire