Usdcad Loses Steam Above The Support

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Usdcad Loses Steam Above The Support

USD/CAD Loses Steam Above The 1.3700 Handle

It is the second day in a row that the USD/CAD is experiencing negative pressure amid a broader USD weakness. At the same time, the bond yields (US) are also weak, which is also not a good sign for the USD/CAD.

For now, the USD/CAD can be seen near 1.3705 with a change of -0.07% for the day. In simple words, the recent decline in the USD/CAD signifies the USD weakness but the strength of the Canadian Dollar.

On the US side, the messages from the Fed officials show no change in the monetary policy. The Fed's president of Boston believes that the target of lower inflation will be achieved without harming the labor market. He also added that the Fed will have to be patient before its next interest rate hike.

Inflation On Path To Decline

Meanwhile, the Fed's present 'Goolsbee' believes that inflation will likely reach the target set by the Fed. However, he also added that the house prices must decline to achieve this objective.

According to market players, the monetary easing in the USA will be initiated somewhere around May 2024, which is around 6 months away.

On the Canadian side, the BoC announced that the low-interest rates in the country are finally coming to an end. Similarly, they also earned the businesses as well as the households to be ready for higher interest rates in the next few years.

Elsewhere, the oil prices have experienced a rebound, which is also supporting a higher Canadian Dollar against the US Dollar.

Looking ahead, the upcoming FOMC meeting minutes will be closely watched by the traders. Similarly, the CPI index for Canada is due, which will show the inflation situation during October. Some more upcoming data from the US includes the Michigan Consumer Sentiment Index and the durable goods orders, which are of moderate importance.

On the D1 chart, the 20 SMA can be seen near 1.377, while the 100 SMA and the 200 SMA are present at 1.3523 and 1.3509.

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