USD/CAD trades below 1.3550 near nine-week lows, eyes on US data

The USD/CAD pair reached a nine-week low at 1.3541 during the Asian session on Wednesday, currently trading below 1.3550. The decline in the USD/CAD pair is attributed to the accommodative remarks from US Federal Reserve (Fed) Governor Christopher Waller. Waller's suggestion that the Federal Reserve may not insist on maintaining high interest rates if inflation consistently declines has likely contributed to the downward pressure on the Loonie pair.

The US Dollar (USD) experiences a retreat against its major currency peers, despite mixed results in United States (US) data. The US Housing Price Index (MoM) maintained consistency at 0.6%, exceeding the expected figure of 0.4% in September. The US CB Consumer Confidence Index increased to 102.0 from the previous reading of 99.1 (Revised from 102.6). However, the Richmond Fed Manufacturing Index printed a negative reading of 5 against the expected 1 positive figure.

Additionally, the improved Crude oil prices are reinforcing the strength of the Canadian Dollar (CAD) against the Greenback. Western Texas Intermediate (WTI) price hovers around $76.60 per barrel at the time of writing. The recovery in Crude oil prices gains momentum as the market anticipates the upcoming meeting of the Organization of the Petroleum Exporting Countries and its allies (OPEC+). The decisions made during this meeting will have a significant impact on oil supply dynamics.

The expectation is that Saudi Arabia will likely propose an extension of oil supply cuts by 1 million barrels a day until next year. Additionally, Russia might consider further supply cuts, potentially reducing its output by 300,000 barrels per day.

Investors' focus will now be on the preliminary Gross Domestic Product (GDP) Annualized for the third quarter in the US. Fed’s Beige Book release, will give a picture of the overall US economic growth. On Thursday, Canada’s GDP Annualized data will present a measure of the total value of all goods and services produced in the country in the third quarter.