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Feb 12, 2018MACROCanada

Canadian Dollar's Correlation to Oil is Back, and this Could Spell Downside

Barclays analysts say the historically strong correlation between oil and the Canadian dollar has returned after crude fell below $60 per barrel. USD/CAD reached 1.26 for the first time since November as WTI breached $60.

WHY IT MATTERS

Oil-linked currency moves affect the USD cost of Canadian feed commodities; with oil expected to stay low, the loonie may stay weak, which can support Canadian-origin canola meal competitiveness.

AFFECTSCanadian Dollar (CAD per USD)▲Crude Oil (WTI)▼

SOURCE
poundsterlinglive.comFeb 12, 2018

Price reaction & history

Canadian Dollar (CAD per USD)▲bullish

Not enough comparable past events yet for a historical read.

Crude Oil (WTI)▼bearishSO FAR1d +0.3%5d +4.4%20d +3.6%

After 565 past bearish macro events, Crude Oil (WTI) moved a median -1.4% over 5 sessions (41% higher; middle half -5.9% to +3.0%), and -0.5% over 20.

May 1, 2019Canadian dollar weakens as Fed inflation view boosts greenback - The Globe and Mail-3.8%
Apr 26, 2019Canadian dollar rises as U.S. growth composition weighs on greenback - The Globe and Mail-5.3%
Mar 31, 2022Canadian dollar shrugs off the oil drop-10.6%
Oct 31, 2022Canadian dollar slips to six-day low as oil prices fall - The Globe and Mail+5.4%
Jul 30, 2026Canadian dollar rises to six-week high as greenback slides - The Globe and Mail-10.1%

Moves of each commodity's benchmark from the last close before the event. Historical reads pool past events of the same kind; they describe what happened, not what will. Not investment advice.

Canadian Dollar (CAD per USD) USDCAD · GP ▸

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Crude Oil (WTI) WTI · GP ▸

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