March 11, 2022
USD/CAD: Loonie pair remains in the negative zone for the third day in a row around the 1.2770 level during the Asian session. USD/CAD bears remain unaffected by the latest pullback amid hopes of a strong monthly employment report from Canada. This helped the Canadian dollar buyers to ignore the recently softer prices of the WTI crude oil, a key export item, as well as broad risk-off mood and stronger US dollar. Canada’s February employment data will be important to watch for near-term trends. From a macroeconomic perspective, Net Employment Change is likely to turn positive, while the Unemployment Rate is expected to ease to 6.2%, which could also help CAD bulls during the next 2 weeks.
EUR/USD: The major currency pair showed a bearish dynamic during Wednesday’s rally, reaching the 1.11 level and then reversing, having pulled back during the US trading session. It happened after the ECB meeting amid a general risk-off market mood. Eastern Europe talks finished with no progress as the war continued. Yesterday, the European Central Bank decided to keep rates unchanged and stated that it would stop injecting money into the financial markets this summer, which means the termination of the QE program. As soon as ECB’s monetary policy decision was published, the EUR/USD climbed above the 1.1100 mark, followed by a pullback.
Gold: Yellow metal’s price was bullish yesterday as equity markets lost optimism after the geopolitical talks failed to deliver progress. Additionally, news of higher inflation is expected in the financial markets, which could bring new buyers for gold. US inflation hit new 40-year highs, and the ECB delivered a hawkish point of view of planned bond purchases for second and third quarters. Demand for gold as a safe-haven asset supported the yellow metal, which traded near the record levels reached in August 2020. However, bulls couldn’t keep this level as profit-taking took place after risk-off sentiment changed.