USD/CAD posts moderate losses above 1.3800, eyes on US UoM data – Crypto News – Crypto News
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Faces rejection near 1.3000 mark, bullish potential intact Faces rejection near 1.3000 mark, bullish potential intact

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USD/CAD posts moderate losses above 1.3800, eyes on US UoM data – Crypto News

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  • USD/CAD snaps the four-day winning streak on Friday.
  • Federal Reserve (Fed) Chair Powell said they are still not sure that rates are high enough to finish the battle with inflation.
  • Markets anticipate a 90% chance the BoC to maintain the interest rates steady at its December meeting.
  • Traders will focus on Fed’s Logan speech, Michigan Consumer Sentiment Index and UoM 5-year Consumer Inflation Expectation data.

The USD/CAD pair posts moderate losses above the 1.3800 psychological support during the Asian trading hours on Friday. A modest intraday loss in the US dollar and the recovery in oil prices cap the upside of the USD/CAD pair. The pair currently trades around 1.3805, down 0.01% on the day

The Federal Reserve (Fed) Chair Jerome Powell offered some hawkish comments on Thursday, which drive the US Dollar (USD) higher broadly. Powell said that they are still not sure that interest rates are high enough to finish the battle with inflation while mentioning that If it becomes appropriate to tighten policy further, they will not hesitate to do it. The markets have priced in 20% odds of more rate hikes in the January meeting and anticipate Fed rate cuts in June 2024.

On the Loonie front, the Bank of Canada (BoC) stated after the rate decision that another rate hike might not be necessary if inflation cools in line with the central bank’s expectations. Additionally, the markets anticipate a 90% chance for the BoC to maintain the interest rates steady at its December meeting. Apart from this, the rebound in oil prices might lift the commodity-linked Loonie as the country is the leading oil exporter to the US.

In the absence of top-tier economic data released from the Canadian docket on Friday, the USD/CAD pair remains at the mercy of USD price dynamics. Investors will keep an eye on the Fed’s Logan speech ahead of the US data, including the US preliminary Michigan Consumer Sentiment Index and UoM 5-year Consumer Inflation Expectation data. These events could give a clear direction to the USD/CAD pair.

 

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