- Canadian dollar drops modestly across the board, unable to benefit from economic data.
- USD/CAD holds bullish tone but remains sideways around monthly highs.
The USD/CAD pair rose to 1.3344 after the beginning of the American session, one pip above the previous August high, reaching the strongest in two months. But it quickly pulled back to the intraday trading range that still prevails, between 1.3305 and 1.3335.
In line with AUD/USD and NZD/USD, the USD/CAD is moving sideways, flat for the day. The greenback recently pulled back against European currencies but the mentioned group was unaffected.
Canadian data today and tomorrow
No data from the US was released today. On Wednesday the key event will be the minutes from the latest FOMC meeting ahead of Fed’s Powell speech on Friday. Also, market participants look close for signals about improvements regarding US-China trade talks.
In Canada, data released today came in better-than-expected. Manufacturing sales in June fell 1.2%, less than the 1.7% decline expected. “Most of the headline manufacturing sales decline was due to a drop in prices, including a big 5% drop in petroleum and coal prices. The 0.2% dip in headline sales once controlling for price changes followed a 1.7% jump in May,” wrote Nathan Janzen, senior economist at the Royal Bank of Canada.
On Wednesday, inflation data is due. The annual CPI rate is expected to show a slowdown from 2.0% to 1.7% in July. “Canadian rates are unlikely to respond to an on-consensus print, however, we see asymmetric risks. An upside surprise will do little to distract markets from the ongoing global slowdown while a miss could see markets pull forward the timing of potential BoC cuts”, explained TD Securities analysts.
Technical levels
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