- US Dollar Index rebounds on today’s data.
- Industrial Product Pirce Index in Canada declines for the third straight month.
- WTI trades in a tight range around $57.
The USD/CAD pair rose a few pips above the 1.32 mark in the early NA session but failed to stretch higher and retraced its daily gains in the last couple of hours. As of writing, the pair was virtually unchanged on the day at 1.3155.
Earlier today, the U.S. Bureau of Economic Analysis’ initial estimate showed that the real GDP is expected to expand by 2.6% in the fourth quarter compared to analysts’ estimate of 2.3%. Other data from the U.S. revealed that the ISM-Chicago’s PMI rose to its highest level in more than a year at 64.7. The US Dollar Index, which dropped to its lowest level since the first week of February today, recovered above 96 on the back of the data.
On the other hand, Statistics Canada announced that the Industrial Product Price Index (IPPI) fell 0.3% in January to post its third straight decline. Additionally, the current account deficit rose to 15.48 billion CAD in Q4 from 10.11 billion CAD.
Although today’s macroeconomic data releases allowed the pair to gain traction, the commodity-sensitive loonie was able to show resilience against the buck with the barrel of West Texas Intermediate clinging to its weekly gains around $57 on Thursday.
On Friday, fourth quarter GDP data from Canada will be watched closely by the market participants. Previewing the data, “Turbulence in the energy sector looks set to drag Friday’s fourth quarter Canadian growth figure lower. Global risks are building too, but there are still some reasons for optimism on the outlook this year,” ING’s developed markets economist James Smith wrote.
USD/CAD Technical outlook by FXStreet editor Flavio Tosti
- USD/CAD rejected the 1.3200 figure as the SMAs are coiled together.
- A break below 1.3150 on a daily closing basis would open the gates to 1.3110 support.
- Resistances are at 1.3170, 1.3200 figure and 1.3230 level.
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