USD/CAD – Canadian Dollar Unchanged Ahead of US GDP

USD/CAD is unchanged in the Thursday session. Currently, the pair is trading at 1.3340. On the release front, the US releases Final GDP, with an estimate of 2.0%, compared to Preliminary GDP which came in at 1.9%. We’ll also get a look at unemployment claims. There are no Canadian events on the schedule. On Friday, Canada releases GDP, with the estimate standing at 0.3%. The US releases UoM Consumer Sentiment, which is expected to improve to 97.8 points.

What’s next for the Bank of Canada? On Tuesday, BoC Governor Stephen Poloz hinted that the BoC would not be raising interest rates in the near future, saying that the Canadian economy had not yet recovered from the huge drop in oil prices. He added that raising interests rates back to “normal” would have a negative effect on the economy and would likely trigger a recession. The last time the BoE raised rates was in 2010, and analysts don’t forecast another hike before 2018. President Trump’s “America first” stance is a serious concern for Canada, which is heavily reliant on open trade. Poloz criticized Trump’s protectionist agenda, saying that “protectionism does not promote growth and its costs are steep”.

It’s been a rough start for the Trump administration, which has been beset by controversy and crises. Trump, who has been in office for more than two months, has yet to provide any details of an economic policy, to the consternation of the markets. Last week, Trump’s proposed healthcare bill was dead on arrival before even being voted on, a humiliating defeat for the president. This setback has made the markets even more jittery about Trump, and the inquiry into the Trump administration’s links with Russia is gathering steam, which is another cause for concern for nervous investors. Trump has said he will now focus on tax reform, but the White House will need to improve coordination with Republican lawmakers to ensure that his next attempt to pass legislation is not a repeat of the healthcare debacle.

USD/CAD Fundamentals

Thursday (March 30)

• 8:30 Canadian RMPI. Estimate 0.8%
• 8:30 Canadian IPPI. Estimate 0.4%
• 8:30 US Final GDP. Estimate 2.0%
• 8:30 US Unemployment Claims. Estimate 244K
• 8:30 US Final GDP Price Index. Estimate 2.0%
• 10:30 US Natural Gas Storage. Estimate -37B
• 11:00 US FOMC Member Robert Kaplan Speech

Upcoming Key Events

Friday (March 31)

• 8:30 Canadian GDP. Estimate 0.3%
• 10:00 US Revised UoM Consumer Sentiment. Estimate 97.8

*All release times are GMT

*Key events are in bold

USD/CAD for Thursday, March 30, 2017

USD/CAD March 30 at 7:00 EST

Open: 1.3332 High: 1.3345 Low: 1.3325 Close: 1.3339

USD/CAD Technical

• USD/CAD is mostly flat in the Asian and European sessions
• 1.3253 is providing support
• 1.3371 is a weak resistance line

Further levels in both directions:

• Below: 1.3253, 1.3120 and 1.3006
• Above: 1.3371, 1.3461, 1.3551 and 1.3672
• Current range: 1.3253 to 1.3371

OANDA’s Open Positions Ratio

USD/CAD ratio is showing movement towards long positions. Currently, short positions have a majority (54%), indicative of trader bias towards USD/CAD breaking out and moving lower.

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.