For the time being, investors can finally look past Fed Chair Janet Yellen as attention has shifted to the interest rate hike from the U.S. Federal Reserve on Wednesday.
It’s the counterintuitive move of “buy the rumour, sell the news” that had investors out of the U.S. dollar following the Fed Wednesday.
Another factor impacting the loonie was U.S. oil inventories coming in at lower levels than expected.
The combination has sent the Canadian dollar higher for its biggest one-day-move since March of last year.
On the energy front, some analysts are questioning whether OPEC production cuts could lead to a crude deficit in the first half of this year, tempting the oil bulls.
With oil and the Fed, the Canadian dollar is back to being impacted by the fluidity of two volatile stories, which for the loonie, could mean more volatility.