The Bank of Canada is one of the only, if not THE ONLY, major Central Bank that has not come out and said they may cut rates.  The last time the BOC moved on rates was on October 24th, 2018.  You may recall that it was just a year ago when some Central Banks were still raising rates. And the BOC was no exception, raising rates from 1.50% to 1.75%.    

Tomorrow Canada releases July CPI (YoY), expecting 1.7%.   Canada also releases Existing Home Sales for July (expecting 5.38M), and on Friday Core Retail Sales will be released for June (MoM) expecting -0.1%.  We may see the BoC jump on the bandwagon and turn more dovish at its next meeting on Sept 4th if the data comes out worse than expected.

USD/CAD is currently banging up against previous support and  the 61.8% retracement from the high on May 31st to the low July 12th  near 1.3350. 

usdcad

 

Source:  Tradingview, FOREX.com

 

However, as we saw with USD/MEX on a shorter timeframe, USD/CAD is putting in higher lows and has  hit this resistance level multiple times.  It appears the market may be trying to get ahead of the BOC and weaken the CAD ahead of the data. 

usdcad

 

Source: Tradingview, FOREX.com

 

If upcoming data from Canada comes out worse than expected, USD/CAD may push higher through resistance towards the May highs near 1.3665.  Support comes in round the upward sloping trendline, near 1.3250.  And if the upcoming data is worse, watch for the BOC to take a move dovish stance at its next meeting.

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility.

Analysis feed

Latest Forex Analysis

Editors’ Picks

EUR/USD holding onto range amid trade tensions, ahead of FOMC minutes

EUR/USD is trading above 1.1050, within familiar ranges. The US Senate's support of Hong Kong protesters has aggravated tensions with China. The Federal Reserve's meeting minutes are eyed.

EUR/USD News

GBP/USD is on the back foot after the Johnson-Corbyn debate

GBP/USD is trading closer to 1.29, after Labour leader Corbyn beat expectations in his debate with PM Johnson. Further opinion polls are awaited. 

GBP/USD News

USD/JPY reverses an early dip to near 1-week lows, focus shifts to FOMC minutes

Reviving safe-haven demand benefitted the JPY and exerted some follow-through pressure. A modest USD rebound helped bounce off lows ahead of the latest FOMC meeting minutes. A sustained move beyond 109.00 handle (200-DMA) needed to confirm near-term bullish bias. 

USD/JPY News

US Dollar Index extends gains to the 97.90 region, focus on Fed, trade

The greenback, when tracked by the US Dollar Index (DXY), is adding to Tuesday’s gains in the 97.90 region. US 10-year yields drop to 2-week lows around 1.75%. FOMC minutes will be the salient event later today.

US Dollar Index News

Gold climbs to near 2-week tops, beyond $1475 supply zone

Gold edged higher through the early European session on Wednesday and climbed to near two-week tops, just above the $1475 region in the last hour.

Gold News

Forex Majors

Cryptocurrencies

Signatures