- USD/CAD prints losses for the previous two sessions consecutively.
- US dollar tests the one-month low on disappointing economic data.
- The Canadian dollar gains on the BOC reaffirmation to control inflation.
USD/CAD extends the previous session’s losses in the early Asian session. The pair hovers in a very narrow trade band with a negative outlook.
At the time of writing, USD/CAD is trading at 1.2443, down 0.01% for the day.
The Canadian dollar rose against the greenback after the Bank of Canada (BOC) Governor Tiff Macklem said that “ the cost of living will not rise out of control as the economy reopens from the COVID-19 pandemic” in a Financial post.
The optimism was also boosted by the higher crude oil prices that traded at a two-week high above $73.00 amid a larger than expected inventory draw and expectations of stronger demand.
The US Dollar Index (DXY), which tracks the greenback performance against its six major rivals stands lower at 91.88%.
The US Gross Domestic Product (GDP) came at 6.5% in Q2, much below the market forecasts of 8.5%. The rapid spread of the Delta variant, supply-chain disruptions, and shortage of labor were expected to weigh on the growth prospects of the rest of the year.
As for now, investors await the slew of economic data; the Canadian Gross Domestic Product (GDP), US Personal Spending and Income data, and Personal Price Expenditure Index (PCE) data to take fresh trading impetus.
USD/CAD additional levels