Key Moments
- EUR/CAD traded around 1.5700, marking a third straight session of gains during European hours on Wednesday.
- Germany’s October HCOB Services PMI rose to 52.5 and Composite PMI to 53.4, while both Eurozone-wide PMIs softened.
- Potential strength in crude oil and geopolitical uncertainty around US-Iran decisions may underpin the Canadian Dollar.
Euro Sustains Momentum Against Canadian Dollar
EUR/CAD extended its upward move for a third consecutive session, hovering near 1.5700 during European trading on Wednesday. The cross remained supported as the Euro held on to earlier gains following the latest HCOB Purchasing Managers’ Index (PMI) releases from Germany and the broader Eurozone.
Market participants turned their focus to upcoming Eurozone Harmonized Index of Consumer Prices (HICP) data, which is scheduled for later in the day and is seen as a potential catalyst for further volatility in the pair.
Mixed PMI Signals From Germany and the Eurozone
Germany’s October HCOB Services PMI was revised higher, rising to 52.5 from a previous reading of 51.7. The country’s Composite PMI also improved, reaching 53.4 compared with 52.8 earlier.
In contrast, the latest Eurozone aggregates pointed to a modest loss of momentum. Eurozone Services PMI slipped to 51.4 from 51.7, while the Composite PMI edged down to 51.7 from 51.9. These figures highlighted a divergence between Germany’s relative resilience and softer readings across the currency bloc as a whole.
Canadian Dollar Outlook Tied to Oil and Geopolitics
Despite the Euro’s recent strength, the upside in EUR/CAD may face headwinds if the Canadian Dollar benefits from any renewed advance in crude oil prices. As a commodity-linked currency, the CAD often reacts to shifts in energy markets.
Investor caution also emerged ahead of decisions from Washington relating to the US-Israeli war on Iran. The backdrop included Democrats’ sweep of US midterm elections, with vote counting in progress and Democrats securing majorities in both houses of Congress for the remainder of President Trump’s second term.
According to Reuters, Priyanka Sachdeva, head of market insights at Phillip Nova, noted that “President Trump’s conflicting signals, with military strikes continuing alongside statements downplaying further escalation, have made it difficult for traders to build strong directional conviction”. She added that “some profit-taking and reduction in speculative long positions are justified, particularly after the sharp rally in October”.
Euro Performance Against Major Currencies
The following table presents the intraday percentage change of the Euro against a basket of major currencies. The data indicate that the Euro showed particular strength versus the US Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.55% | -0.56% | -0.24% | -0.40% | -0.62% | -0.39% | -0.58% | |
| EUR | 0.55% | 0.00% | 0.32% | 0.13% | -0.08% | 0.15% | -0.03% | |
| GBP | 0.56% | -0.01% | 0.34% | 0.19% | -0.06% | 0.15% | -0.04% | |
| JPY | 0.24% | -0.32% | -0.34% | -0.16% | -0.38% | -0.17% | -0.35% | |
| CAD | 0.40% | -0.13% | -0.19% | 0.16% | -0.22% | -0.01% | -0.19% | |
| AUD | 0.62% | 0.08% | 0.06% | 0.38% | 0.22% | 0.21% | 0.04% | |
| NZD | 0.39% | -0.15% | -0.15% | 0.17% | 0.00% | -0.21% | -0.18% | |
| CHF | 0.58% | 0.03% | 0.04% | 0.35% | 0.19% | -0.04% | 0.18% |
The heat map should be read by selecting the base currency from the left-hand column and the quote currency from the top row. For instance, choosing the Euro on the left and moving horizontally to the US Dollar column shows the percentage move for EUR (base)/USD (quote).
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