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USD/CAD firms as traders await US GDP and PCE data
FXStreet said USD/CAD is up about 0.1% on the day, with investors watching Advance Q2 GDP and the Core PCE Price Index for clues on the Fed path.
FXStreet reports that USD/CAD is edging higher on Thursday, snapping a two-day losing streak that had left the pair near a more than one-week low around 1.4025 to 1.4020. Spot prices are trading around the 1.4060 area, up roughly 0.1% for the day as traders look for fresh direction from upcoming US data releases.
The outlet points to Thursday's US economic docket, including the Advance Q2 GDP report and the Personal Consumption Expenditures, or PCE, Price Index. The results are expected to shape market expectations for the Federal Reserve's future policy path amid bets for at least one rate hike by the end of this year, which can influence USD demand and activity around USD/CAD.
FXStreet also links near-term USD support to shifting inflation dynamics and geopolitical risk. It notes that volatile energy prices have contributed to a more hawkish case for the Fed, while escalating US-Iran tensions are contributing to a higher geopolitical risk premium that supports crude oil prices.
For the Canadian side, the article says the Canadian dollar, often described as the commodity-linked Loonie, struggles to attract buyers due to the Bank of Canada's dovish bias and trade-war fears. That backdrop, according to the piece, favors USD/CAD bulls and suggests any intraday pullback is likely to be limited as traders position for the US macro releases.
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