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Canadian GDP slides 0.1% in August – USD/CAD jumps

Canada’s economy squeezed in August: a drop of 0.1% in August followed no growth in July. This shows a significant slowdown. Year over year, the economy grew 2.3%, below 2.5% predicted.

The Canadian dollar doesn’t like it, with USD/CAD leaping from under 1.12 to 1.1235 at the time of writing.

Canada was expected to report no growth in the month of August, after no change also in July.

USD/CAD traded under 1.12 towards the publication.

The Canadian dollar managed to hold out quite well in the wake of the hawkish Fed statement. The US Federal Reserve was upbeat on the labor market. It is important to remember that a stronger US economy is good news for Canada as well.

For more on the C$, see the Loonie forecast. Here is how the climb of Dollar/CAD looks on the chart. It’s a straight line up:

Canadian dollar down after Canada economy contracts in August October 31 2014

Yohay Elam

Yohay Elam

Yohay Elam: Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I've accumulated. After taking a short course about forex. Like many forex traders, I've earned a significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I've worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts.