Kenny Fisher | Jul 31, 2018 08:34
The Canadian dollar is showing little movement in the Tuesday session. Currently, USD/CAD is trading at 1.3042, up 0.05% on the day. On the release front, Canada releases its monthly GDP report, which is expected to rise to 0.3%. Canadian Raw Materials Price Index is forecast to drop to 2.7%. The U.S. will release consumer inflation and spending reports. As well, CB Consumer Confidence is expected to tick up to 126.5 points. On Wednesday, the Federal Reserve will release a rate statement.
The U.S. economy continues to hum in the second quarter. Advance GDP for Q2, the first of three GDP reports, posted a sparkling gain of 4.1%, just shy of the forecast of 4.2%. This was much stronger than the gain of 2.2% in Q1 and marked the strongest quarter of economic growth since 2014. President Donald Trump took credit for the strong GDP report and claimed that “these numbers are very, very sustainable.” However, analysts are being more cautious in their forecasts, calling for growth in the third quarter of around 2.5 percent.
Negotiations over NAFTA have progressed slowly, but policy-makers in Canada and Mexico are hopeful that the flexibility that the U.S. has shown towards the European Union will extend to NAFTA as well. Last week, Trump met with EU Commission President Jean-Claude Juncker and announced that the U.S. would hold off any further tariffs while the sides were negotiating. Will this goodwill extend to NAFTA as well? The U.S. has insisted on far-reaching changes to the pact, including its renegotiation in five years and higher U.S. content in automobiles produced in North America. If its demands aren’t met, the Trump administration has said it could pursue separate free-trade agreements with Canada and Mexico. However, the latter two countries would like to maintain a trilateral arrangement. If the parties are able to reach a new agreement, the Canadian dollar would likely move higher.
USD/CAD Fundamentals
Tuesday (July 31)
Wednesday (August 1)
*All release times are DST
*Key events are in bold
USD/CAD for Tuesday, July 31, 2018
USD/CAD, July 31 at 7:30 DST
Open: 1.3035 High: 1.3096 Low: 1.3023 Close: 1.3047
USD/CAD Technical
S3 | S2 | S1 | R1 | R2 | R3 |
1.2733 | 12831 | 1.2970 | 1.3067 | 1.3160 | 1.3292 |
USD/CAD ticked higher in Asian trade and has retracted in the European session
Further levels in both directions:
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