FXStreet (Córdoba) – According to Marc Chandler, Global Head of Currency Strategy at Brown Brothers Harriman, Canadian elections on Monday are not driving the loonie in the currency market; the currency is been affected by oil, interest rate differentials, and the general risk environment.
Key Quotes:
“Canada’s national election is slated for Monday. The latest opinion polls show a virtual dead heat between the governing Conservatives and Liberals.”
“Although we had thought the Canadian dollar would be impacted by the political uncertainty surrounding the election, the focus is elsewhere. Many traders emphasize oil prices. Simply looking at directional correlation, oil and the Canadian dollar have moved in the same direction 94 of the past 100 sessions. Correlation of returns (percentage change) is about 0.57 over the past 60 sessions. It has been flat around there since late-May.“
“The electoral outcome may pose some headline risk, but market participants may be better served by focusing on the drivers of the Canadian dollar: oil, interest rate differentials, and the general risk environment.”
(Market News Provided by FXstreet)