TRENDING:

USD/CAD nudges up, nearing 1.3950 with US PCE, Canada's GDP on tap

The US Dollar extends its gain, nearing 1.3950, buoyed by strong US macroeconomic data.
A solid US GDP growth and lower jobless claims have curbed hopes of immediate Fed easing.
US PCE Prices Index figures and Canada's monthly GDP will set the pair's near-term direction later today.

The US dollar continues to take bids against its Canadian Counterpart on Friday. The pair is hovering at levels right below 1.3950 in the early European session, on trach to its strongest weekly performance since February.

The Greenback drew additional support on Thursday from better-than-expected US macroeconomic data, namely the Q2 Gross Domestic Product and weekly Jobless Claims, which prompted investors to cut back hopes for immediate rate cuts.

Strong US data curbs hopes of an October rate cut

Data from the US Commerce Department revealed that the US economy accelerated to a 3.8% annualized growth rate in the second quarter, following a 0.5% contraction in the first quarter, and well above the 3.3% growth rate previously estimated.

These figures were accompanied by an unexpected decline in Initial Jobless Claims that fell to 218K, from 232K in the previous week, against expectations of an increase to 235K.

Furthermore, orders for expensive goods manufactured in the US jumped 2.9% in August, against the market consensus of a 0.5% decline and following two consecutive months of contractions. These figures improve the outlook for US manufacturing activity.

All these figures have endorsed the view of Fed speakers calling for a cautious approach to monetary easing and prompted investors to scale down bets on an October rate cut. The focus today will be on the US PCE Price Index for further insight into this matter.

The Canadian Dollar, on the other hand, remains on the defensive as a raft of weak macroeconomic figures has boosted hopes of further easing by the BoC. In this context, July’s GDP data, due later today, is expected to show a moderate rebound in economic growth that might provide some support to the Loonie.

Economic Indicator

Personal Consumption Expenditures - Price Index (YoY)

The Personal Consumption Expenditures (PCE), released by the US Bureau of Economic Analysis on a monthly basis, measures the changes in the prices of goods and services purchased by consumers in the United States (US). The YoY reading compares prices in the reference month to a year earlier. Price changes may cause consumers to switch from buying one good to another and the PCE Deflator can account for such substitutions. This makes it the preferred measure of inflation for the Federal Reserve. Generally, a high reading is bullish for the US Dollar (USD), while a low reading is bearish.

Economic Indicator

Gross Domestic Product (MoM)

The Gross Domestic Product (GDP), released by Statistics Canada on a monthly and quarterly basis, is a measure of the total value of all goods and services produced in Canada during a given period. The GDP is considered as the main measure of Canadian economic activity. The MoM reading compares economic activity in the reference month to the previous month. Generally, a high reading is seen as bullish for the Canadian Dollar (CAD), while a low reading is seen as bearish.

Markets move fast. We move first.

Orange Juice Newsletter brings you expert driven insights - not headlines. Every day on your inbox.

Editor's Picks

EUR/USD: Upside remains capped by 1.1600

EUR/USD trades in an unconvincing fashion around the 1.1560 region despite the better tone in the broader risk complex and amid the equally vacillating price action around the US Dollar. Investors, in the meantime, should pay close attention to developments from the US political arena, particularly anything related to the potential end of the US government shutdown.

GBP/USD holding just below 1.32 as UK labor data rounds the corner

GBP/USD kept its foot on the gas pedal on Monday, extending into a four-day win streak as Cable traders gear up for the latest round of UK employment figures. Veterans Day will see a moderation of market flows in the US on Tuesday, but hopes that the US could be close to wrapping up the longest government funding closure in its history should keep risk appetite well bid and put a hard cap on bullish US Dollar flows.

Gold holds gains near $4,150 as focus shifts to the weekly ADP jobs report.

Gold price holds positive ground near $4,150 in the Asian session on Tuesday. The precious metal edges higher after reaching a two-week high in the previous session, amid prospects for rate cuts by the US Federal Reserve in December and a softer US Dollar. The US ADP Employment Change Weekly will be in the spotlight later on Tuesday.

Coinbase rolls out public token sale platform, Monad to kick off launch

Coinbase announced that it will roll out a new platform for crypto offerings. The platform will enable individual investors to purchase digital tokens before they are listed on the exchange. Following its launch, Layer-1 network Monad will offer its token for sale on the platform on November 17.

AI shares an intrusive thought

If you’ve been following financial media over the past few weeks, you’ve probably seen the debate about whether the current AI-fuelled rally is a bubble. I’ve said many times that I believe it is—but the bubble question is almost secondary to a more immediate issue: what AI is about to do to jobs.

Top 3 Price Prediction: Bitcoin, Ethereum, Ripple extend recovery as market sentiment improves

Bitcoin (BTC), Ethereum (ETH), and Ripple (XRP) traded higher on Monday after rebounding from key support levels the previous week. The top three cryptocurrencies suggest further recovery, as momentum indicators signal a fading bearish trend.