USD/CAD slumps as T-bond yields fall

After reaching four-week highs, the USD/CAD pair has slumped for the second successive session down 0.18%, the pair is now trading at 1.2524 during on Monday.

The fall is mainly driven by US dollar’s current weakness, caused by a weaker than expected University of Michigan consumer sentiment that plummeted to a 10-year low in November amid concerns about the pace of elevated prices.

The fall of the U. S. bond yields weighed on demand for the US dollar, which is on defensive mode as the week begins.

Speculations are mounting that U. S. President Joe Biden will release supplies from the Strategic Petroleum Reserve (SPR), which could weigh on the oil-commodity-linked Canadian dollar, that could lift the prospects of the USD/CAD pair.