- USD/CAD continues to fall on the week and points higher.
- US dollar mixed on Friday between lower US yields and risk aversion.
- Key events for the coming week: Canadian CPI (Tuesday) and FOMC meeting (Wednesday).
He USD/CAD posted a fresh daily high on Friday at 1.3772, amid weaker Loonie and mixed Dollar. After pulling away from the low, the pair is about to post a small weekly loss.
the bad and the ugly
Data released on Friday showed the Canadian Industrial Goods Price Index fell 0.8%, a surprise considering market expectations for a 1.6% rise. The commodity price index fell 0.4%, below the 0% estimate. Economic numbers did not help the Loonie, which is among Friday’s worst performers.
Next week, the key report for the Canadian economy will be the Consumer Price Index (CPI) for February, due to be released on Tuesday. It is expected to show an increase of 0.4% m/m, with the annual rate slowing from 5.9% in January to 5.5%.
The US dollar is mixed on Friday, trying to recover as Wall Street stocks deepen their losses. US yields are down 4% on average, with the 10-year yield at 3.41%, slightly above the March lows.
Markets remain uneasy about the banking turmoil and next week is the FOMC meeting. Consensus remains for a 25 basis point rate hike, but the end of the tightening cycle is in sight sooner than previously thought. The change in expectations weighed on the dollar.
Higher lows, lower highs
USD/CAD has posted higher lows and lower highs over the past several sessions. On Friday it reversed from a two-day low at 1.3676 and jumped to 1.3763. The short-term direction is unclear.
The pair remains above the 20-day SMA (1.3655) and also above the key support zone at 1.3660/70. As long as it holds above these two supports, the outlook looks constructive for USD/CAD.
USD/CAD 4-hour chart
technical levels
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
