Forex News: Canadian Dollar Rises As Oil Prices Climb

Canadian Dollar Rises As Oil Prices Climb

(RTTNews) - The Canadian dollar strengthened against other major currencies in the European session on Tuesday, with Brent crude futures surging toward $100 a barrel on growing risks of a prolonged conflict in the Middle East.

Brent crude prices were up nearly 2 percent at $98.97 a barrel, hitting a six-week high after Iran threatened to retaliate against any new U.S. attacks on its assets and Saudi-led coalition forces vowed a resolute response to a wave of attacks from Houthi rebels. WTI crude futures were up 3.2 percent at $94.39 a barrel.

Saudi Arabia's Jazan refinery was reportedly hit again Monday in what is likely to be another Houthi attack on one of the Red Sea's largest oil processing plants, but the damage was limited.

Describing the Houthi attacks against Saudi Arabia as a "dangerous escalation", the Saudi-led coalition spokesperson Turki AI-Maliki warned that measures will be taken to counter further threats.

Meanwhile, Iranian Parliament Speaker Mohammad Baqer Qalibaf has warned the U.S. that any new U.S. attacks on Iran's oil and gas assets will draw a reciprocal response, stressing that energy infrastructure across the Persian Gulf, including U.S. oil and gas facilities, are vulnerable.

Separately, Mohsen Rezaei, a senior Iranian security official, has warned that if the U.S. continued to wage "economic warfare" against Iran, it will be met by a maritime exclusion zone across the Persian Gulf to the blockade perimeter.

Traders also watched for details of an Iranian deal with Oman to manage shipping through the Strait of Hormuz.

Meanwhile, the rising trade tensions between the U.S. and Canada also remained on investors' radar.

With no sign of a trade deal on the horizon, Canada's retaliatory tariffs of 15 percent to 50 percent on hundreds of American goods are set to take effect today.

Sharpening the trade standoff with Canada, U.S. President Donald Trump on Monday threatened to block the sale of Bombardier jets in the U.S.

In the European trading today, the Canadian dollar rose to a 4-day high of 0.9942 against the Australian dollar, from an early low of 0.9970. The loonie may test resistance around the 0.97 region.

Against the U.S. dollar and the euro, the loonie advanced to 5-day highs of 1.3776 and 1.6016 from early lows of 1.3815 and 1.6058, respectively. If the loonie extends its uptrend, it is likely to find resistance around 1.36 against the greenback and 1.59 against the euro.

The loonie edged up to 111.82 against the yen, from an early 9-month low of 110.77. The next possible upside target for the loonie is seen around the 115.00 region

Looking ahead, U.S. NFIB business optimism index for August, U.S. ADP weekly employment data, U.S. used car prices for August, U.S. consumer inflation expectations for August and consumer credit change for July are slated for release in the New York session.

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