USD/CAD slips below 1.3200 as US Dollar retreats ahead of US/Canada inflation, ignores downbeat Oil Price – Crypto News – Crypto News
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USD/CAD nosedives from six-week highs, back below 1.3000 USD/CAD nosedives from six-week highs, back below 1.3000

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USD/CAD slips below 1.3200 as US Dollar retreats ahead of US/Canada inflation, ignores downbeat Oil Price – Crypto News

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  • USD/CAD takes offers to reverse the previous day’s corrective bounce off the lowest level since September 2022.
  • WTI crude oil fails to cheer risk-positive headlines surrounding China, supply fears from Russia.
  • US Dollar Index retreats after posting the first weekly gain in four amid market’s consolidation amid light calendar.
  • Inflation clues from Canada, US will be important to watch for clear directions.

USD/CAD clings to mild losses around 1.3160 ​​while reversing the previous day’s corrective bounce off the nine-month low during early Monday. In doing so Looney The pair ignores downbeat Oil prices while cheering the US Dollar’s weakness amid cautious optimism in the market.

WTI crude oil takes offers to refresh intraday low near $69.50 amid fears of China’s economic growth, despite risk-positive headlines suggesting more stimulus from Beijing. That said, global rating agency S&P recently cut China’s Gross Domestic Product (GDP) growth forecast for 2023 to 5.2% from 5.5% previous estimations.

Apart from the S&P news, headlines suggesting major investors’ pause in China optimism join hawkish comments from the Fed officials and comparatively upbeat US data to weigh on the Oil price.

However, news signaling sooner stimulus from China and doubts about Russian President Vladimir Putin’s power in Moscow favor sentiment and put a floor under the WTI crude oil price, as well as weigh on the US Dollar,

Ning Jizhe, deputy head of the economic committee of the Chinese People’s Political Consultative Conference (CPPCC) and a former vice head of the National Development and Reform Commission (NDRC) flagged concerns about sooner stimulus from China. “Heavily armed Russian mercenaries withdrew from the southern Russian city of Rostov under a deal that halted their rapid advance on Moscow but raised questions on Sunday about President Vladimir Putin’s grip on power,” said Reuters in this regard.

On Friday, US S&P Global PMIs for June came in mixed as the Manufacturing PMI dropped to 46.3 from 48.4 prior, versus 48.5 expected, whereas the Services PMI improved to 54.1 from 54.0 expected despite being less than the 54.9 previous monthly figure. With this, the composite pmi declined to 53.0 versus 54.4 market forecasts and 54.3 prior.

Following the mixed US PMIs, Chris Williamson, Chief Business Economist at S&P Global Market Intelligence said, “Any further rate hikes will of course have a further dampening effect on this sector (services) which is especially susceptible to changes in borrowing costs.” That Said Federal Reserve Bank of San Francisco President Mary Daly told Reuters on Friday that two more interest rate increases this year would be a “very reasonable projection.”

While portraying the mood, S&P500 futures rose 0.20% intraday near 4,400 despite witnessing a downbeat week for Wall Street and gains of the US Treasury bond yields.

Looking forward, inflation numbers from the US and Canada, as well as speeches of the top-tier central bankers at the European Central Bank (ECB) Forum, will be important to watch for the USD/CAD traders. Additionally, US Durable Goods Orders and Bank Stress Tests are additional catalysts to observe.

technical analysis

A U-turn from the two-week-old descending resistance line, around 1.3185 by the press time, directs USD/CAD bears towards the latest multi-month trough surrounding 1.3140.

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