- Disappointing data from the United States (US) revived recession fears.
- Canada's gross domestic product (GDP) came flat in July.
- US Dollar Index dropped into the negative territory in the American session.
The USD/CAD pair rose to its highest level in a week at 1.3290 in the early trading hours of the American session on Tuesday after the uninspiring gross domestic product (GDP) from Canada weighed on the Loonie. However, with the Greenback coming under strong pressure later in the session, the pair reversed its direction and slumped into the negative territory. As of writing, the pair was down 0.05% on the day at 1.3234.
Statistics Canada today announced that the economic activity in Canada, as measured by the GDP, stayed unchanged in July and missed the market expectation for an expansion of 0.1%.
The manufacturing sector in the US weakened in September
Later in the session, the Institue for Supply Management's (ISM) Manufacturing Purchasing Managers Index (PMI) plummeted to its lowest level in nearly a decade at 47.8 in September and fell short of analysts' estimate of 50.1. The dismal reading revived concerns over a possible recession in the US and caused investors to start pricing more rate cuts by the Federal Reserve before the end of the year.
The US Dollar Index, which advanced to its best level in more than two years at 99.67 today, made a sharp U-turn and erased all of its daily gains. At the moment, the index is down 0.18% on the day at 99.20. Although the Markit Manufacturing PMI's final reading for September ticked up to 51.1 from 51 in the previous estimate, it failed to help the Greenback shake off the selling pressure.
Technical levels to watch for
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. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD holds above 1.0650 after US data
EUR/USD retreats from session highs but manages to hold above 1.0650 in the early American session. Upbeat macroeconomic data releases from the US helps the US Dollar find a foothold and limits the pair's upside.
GBP/USD retreats toward 1.2450 on modest USD rebound
GBP/USD edges lower in the second half of the day and trades at around 1.2450. Better-than-expected Jobless Claims and Philadelphia Fed Manufacturing Index data from the US provides a support to the USD and forces the pair to stay on the back foot.
Gold clings to strong daily gains above $2,380
Gold trades in positive territory above $2,380 on Thursday. Although the benchmark 10-year US Treasury bond yield holds steady following upbeat US data, XAU/USD continues to stretch higher on growing fears over a deepening conflict in the Middle East.
Ripple faces significant correction as former SEC litigator says lawsuit could make it to Supreme Court
Ripple (XRP) price hovers below the key $0.50 level on Thursday after failing at another attempt to break and close above the resistance for the fourth day in a row.
Have we seen the extent of the Fed rate repricing?
Markets have been mostly consolidating recent moves into Thursday. We’ve seen some profit taking on Dollar longs and renewed demand for US equities into the dip. Whether or not this holds up is a completely different story.