USD/CAD slips to fresh monthly lows after FOMC
The minutes from the May (2nd & 3rd) Federal Reserve’s monetary policy put the greenback under selling pressure, pushing the USD/CAD to its lowest level since April 24 at 1.3418. As of writing, the pair was trading at 1.3424, losing 90 pips, or 0.66%, on the day.
The minutes showed that a few of the Fed officials raised concerns over the slowdown of the progress of the inflation towards the bank's 2% target. Most members also reiterated that the uncertainty surrounding the Trump administration's economic proposals remained. Overall though, the committee's assessment of the economy changed little since the March policy meeting, suggesting a neutral stance. Nevertheless, the US Dollar Index dropped to 97 area, erasing its daily gains, and is now at 97.15, down 0.12%.
On the other hand, ahead of tomorrow's important OPEC meeting, crude oil is having a difficult time adding to its recent gains, with the barrel of WTI trading at $51.30, losing 17 cents on the day, limiting the gains of the commodity-linked loonie.
Technical outlook
The pair could encounter the immediate support at 1.3400 (psychological level) followed by 1.3320 (Apr. 10 low) and 1.3240 (Apr. 12 low). To the upside, resistances align at 1.3500 (psychological level), 1.3540 (daily high) and 1.3630 (20-DMA).
Author
Eren Sengezer
FXStreet
As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.
