Canadian Dollar drives lower as Loonie races Greenback to the bottom

• The Canadian Dollar shed further weight against the US Dollar on Monday.
• Despite a general easing in Greenback flows, the Loonie crumpled faster.
• Weakening Crude Oil prices and a complicated RMPI print clipped CAD support.

The Canadian Dollar (CAD) weakened once again on Monday, falling against the US Dollar (USD) and closing off potential for a near-term bullish reversal. The Loonie has fallen for three of the last four consecutive sessions against the Greenback, adding another 0.3% to the losses pile and bringing its four-day performance to -0.75% top-to-bottom.

Crude Oil prices continue to struggle near four-month lows, ripping support out from beneath the commodity-tied Canadian Dollar. The latest Raw Material Price Index (RMPI) showed input good prices contracted by 0.6% in August, but stripping out energy prices actually saw raw material prices increase over the month.

Daily digest market movers: Canadian Dollar falters amid middling data and weak oil prices

• The Canadian Dollar shed over one-third of one percent against the US Dollar on Monday.
• Headline Canadian raw materials prices declined 0.6% MoM in August, entirely reversing the expected 1.2% uptick.
• Stripping energy costs out of the RMPI showed that aggregate input costs actually rose 0.9% in August, up 15.5% YoY.
• The only thing keeping Loonie losses under wraps are weak US Dollar flows;
• The economic calendar is tilted heavily toward US data releases this week. US Purchasing Managers Index (PMI) survey results are due on Tuesday, with US Gross Domestic Product (GDP) growth figures on Thursday and key Personal Consumption Expenditures Price Index (PCE) inflation data due on Friday.

Canadian Dollar price forecast

Steepening losses for the Canadian Dollar are beginning to pile up as CAD bulls run out of steam, pushing the Loonie back down from recent highs and chalking in a third straight failure to crack the 1.3740 support zone on the USD/CAD daily candlesticks.

USD/CAD remains capped by the 200-day Exponential Moving Average (EMA) near 1.3865, limiting upside potential for Greenback bidders. However, CAD buyers have fumbled bullish technical setups multiple times in a row, tipping odds in favor of fresh US Dollar strength in the near term.

USD/CAD daily chart