USD/CAD gathers strength to recapture 1.3800 ahead of Fed policy


  • USD/CAD aims to recapture 1.3800 amid firm US Dollar.
  • A sharp decline in Fed rate-cut bets boosts the US Dollar’s appeal.
  • Investors look for fresh cues about BoC’s subsequent rate cuts.

The USD/CAD pair clings to gains near 1.3770 in Monday’s New York session. The Loonie asset aims to extend upside as the US Dollar (USD) remains firm due to diminished Federal Reserve (Fed) rate-cut bets for the September meeting.

Traders pares Fed rate-cut bets swiftly after the strong United States (US) Nonfarm Payrolls (NFP) report for May eliminated fears of normalizing labor market conditions. The report showed that labor demand remained robust across all sectors and wage growth was stronger-than-expected.

Investors are now expecting that the Fed will cut interest rates once this year, either in November or December. For more cues over the interest rate outlook, investors will pay close attention to the US Consumer Price Index (CPI) data for May and the Fed’s monetary policy, which are scheduled for Wednesday.

Annual core inflation, which excludes volatile food and energy prices, is estimated to have decelerated to 3.5% from April’s reading of 3.6%. In the same period, headline inflation is expected to have grown steadily by 3.4%.

The Fed is widely anticipated to maintain interest rates steady in the range of 5.25%-5.50% with a hawkish outlook as the last mile for inflation to return to the desired rate of 2% appears to be stickier.

On the Canadian Dollar front, investors await the speech from Bank of Canada (BoC) Governor Tiff Macklem, which is scheduled for Wednesday. BoC Macklem will provide more cues about whether the central bank will announce subsequent rate cuts. Last week, the BoC lowered its key borrowing rates for the first time in four years.

USD/CAD

Overview
Today last price 1.3762
Today Daily Change -0.0004
Today Daily Change % -0.03
Today daily open 1.3766
 
Trends
Daily SMA20 1.3663
Daily SMA50 1.3673
Daily SMA100 1.359
Daily SMA200 1.3578
 
Levels
Previous Daily High 1.3768
Previous Daily Low 1.3663
Previous Weekly High 1.3768
Previous Weekly Low 1.3603
Previous Monthly High 1.3783
Previous Monthly Low 1.359
Daily Fibonacci 38.2% 1.3728
Daily Fibonacci 61.8% 1.3703
Daily Pivot Point S1 1.3697
Daily Pivot Point S2 1.3628
Daily Pivot Point S3 1.3592
Daily Pivot Point R1 1.3801
Daily Pivot Point R2 1.3837
Daily Pivot Point R3 1.3906

 

 

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