USD/CAD remains on the defensive near 1.3650 ahead of Canadian CPI data
24.06.2024, 23:13

USD/CAD remains on the defensive near 1.3650 ahead of Canadian CPI data

  • USD/CAD posts modest gains near 1.3655 in Tuesday’s early Asian session. 
  • BoC Governor Tiff Macklem said the Canadian economy is on track for a soft landing. 
  • Investors await the release of the US GDP growth number on Thursday and the PCE Price Index on Friday. 

The USD/CAD pair remains on the defensive around 1.3655 during the early Asian session on Tuesday. The USD Index (DXY) retreats from nearly two-month tops to 105.50, exerting some selling pressure on the pair. Investors will focus on the Canadian Consumer Price Index (CPI) inflation report, which is forecast to cool slightly for the year through May. 

Late Monday, the Bank of Canada (BoC) Governor Tiff Macklem said that the Canadian economy is on track for a soft landing where the central bank doesn’t need a large rise in the unemployment rate to achieve the inflation target. Macklem further stated that it's reasonable to expect additional rate cuts. This speech came two weeks after the Canadian central bank lowered its policy interest rate to 4.75% from 5%, the first rate cut in four years. The Canadian Dollar (CAD) strengthens, even though investors expect that the BoC will deliver more rate cuts this year.

Meanwhile, the rise in crude oil prices amid renewed hopes of a summertime upswing in fuel demand continues to underpin the commodity-linked Loonie. It's worth noting that higher oil prices could support the CAD as Canada is the major crude oil exporter to the United States.

On the USD’s front, the US Federal Reserve (Fed) officials maintain a cautious stance on rate cuts, highlighting that their decisions would remain data-dependent. On Monday, San Francisco Fed President Mary Daly said that the Fed must continue the work of fully restoring price stability without a painful disruption to the economy. Daly added that while the central bank still has "more work to do" on bringing inflation down, inflation is not the only risk they face.

Traders will take more cues from the crucial US economic data this week. The revision of US Gross Domestic Product (GDP) for the first quarter will be released on Thursday. On Friday, the Personal Consumption Expenditure (PCE) Price Index will be published. Traders are now pricing in a 66% odds of Fed rate cut in September, up from 59.5% at the end of last week, according to the CME FedWatch Tool. 

USD/CAD

Overview
Today last price 1.3658
Today Daily Change -0.0036
Today Daily Change % -0.26
Today daily open 1.3694
 
Trends
Daily SMA20 1.3699
Daily SMA50 1.3696
Daily SMA100 1.3618
Daily SMA200 1.3585
 
Levels
Previous Daily High 1.3719
Previous Daily Low 1.3675
Previous Weekly High 1.3764
Previous Weekly Low 1.3675
Previous Monthly High 1.3783
Previous Monthly Low 1.359
Daily Fibonacci 38.2% 1.3702
Daily Fibonacci 61.8% 1.3692
Daily Pivot Point S1 1.3673
Daily Pivot Point S2 1.3652
Daily Pivot Point S3 1.3628
Daily Pivot Point R1 1.3717
Daily Pivot Point R2 1.374
Daily Pivot Point R3 1.3761

 

 

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