USD/CAD bulls in control, Hurricane Harvey induced buying towards 1.25 handle

Currently, USD/CAD is trading at 1.2476, down -0.02% on the day, having posted a daily high at 1.2488 and low at 1.2442.

USD/CAD has popped higher on the back of WTI prices dropping due to the lack of demand for it from refineries suffering Hurricane Harvey. The correction comes just after the bears had been testing fresh marginal multi-week highs at the upper end of its August range. 

WTI recovery struggles around $47.70, Harvey eyed

Elsewhere, the greenback is on the backfoot in the broader sense given the concerns over the debt ceiling and the Fed. Although markets still expect a further rate hike in December, expectations have been dwindling as to the pace of rate hikes throughout 2018. Near-term domestic risk is limited ahead of the current account (Wed.) and GDP data (Thurs.) for Q2 while markets await the US nonfarm payrolls on Friday. The next BoC policy decision is on September 6th. 

USD/CAD levels

Analysts at Scotiabank continue to highlight the absence of any meaningful support ahead of the late July low just above 1.2400. "Near-term resistance is now expected between 1.2500 and 1.252," explained the analysts.