Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

USD/CAD – Canadian Dollar Dips, BoC Rate Decision Looms

Published 07/11/2018, 08:08 AM
Updated 03/05/2019, 07:15 AM

The Canadian dollar has posted slight losses in the Wednesday session. Currently, USD/CAD is trading at 1.3154, up 0.31% on the day. On the release front, In the US, the focus is on inflation reports, with PPI and Core PPI both expected to soften to 0.2%. The Bank of Canada will set the benchmark rate and release a rate statement. On Thursday, Canada publishes New Housing Price Index. The US will release CPI and Final CPI as well as unemployment claims.

The spotlight is on the Bank of Canada, which holds its monthly rate meeting on Wednesday. The markets are expecting that Bank policymakers will raise rates by a quarter-point to 1.50%, a level not seen since December 2008. Earlier this month, BoC Governor Stephen Poloz said that the July rate decision would be based on economic data, and Friday’s strong employment data will be added ammunition in favor of raising rates at the upcoming meeting. The economy created 31.8 thousand jobs in June, well above the estimate of 22.3 thousand. Wage growth also looked strong, as hourly earnings gained 3.5% in June on an annualized basis. The Canadian economy is forecast to gain 2% this year, after a strong performance of 3% in 2017. Inflation has improved and is close to the BoC target of 2 percent. However, bank policymakers remained concerned about escalating trade tensions, which includes a tariff spat between the US and Canada.

Investors remain uneasy about the tariff battle being waged between the US and its major trading partners, particularly China. After the US and China imposed tariffs on each other of some $30 billion, the Trump administration has raised the ante, threatening to hit China with further tariffs on $200 billion worth of Chinese goods. China cannot retaliate in kind, since it does not import that amount of goods from the US. Still, the Chinese can take steps which will make it more difficult for US companies to do business in China. The US dollar has benefited from the recent trade battles, and if this trend continues, the Canadian dollar could be facing some substantial headwinds.

Wednesday (July 11)

Thursday (July 12)

  • 8:30 Canadian NHPI. Estimate 0.1%
  • 8:30 US CPI. Estimate 0.2%
  • 8:30 US Core CPI. Estimate 0.2%
  • 8:30 US Unemployment Claims. Estimate 226K

*All release times are DST

*Key events are in bold

USD/CAD for Wednesday, July 11, 2018

USD/CAD for July 11, 2018

USD/CAD, July 11 at 7:55 DST

Open: 1.3114 High: 1.3174 Low: 1.3108 Close: 1.3154

USD/CAD Technical

S3 S2 S1 R1 R2 R3
1.2831 1.2970 1.3067 1.3160 1.3292 1.3436

USD/CAD has posted small gains in the Asian and European sessions

  • 1.3067 is providing support
  • 1.3160 was tested earlier in resistance. It is a weak line
  • Current range: 1.3067 to 1.3160

Further levels in both directions:

  • Below: 1.3067, 1.2970 and 1.2831
  • Above: 1.3160, 1.3292, 1.3436 and 1.3530

Original post

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.