- The US dollar extends losses due to appetite for the risk and hopes of fed rate cuts.
- Canadian Prime Minister Carney confirmed that commercial conversations will continue this week.
- The weak data of the Canadian GDP and the fall in oil prices struggled to the Canadian dollar last week.
The US dollar is giving most of the land earned in the two previous negotiation days. The positive feeling of risk after the announcement that the commercial conversations between Canada and the US will continue has promoted confidence in the CAD, pushing the US dollar again below the level of 1,3700, reaching minimums intradic in 1,3650 so far.
On Sunday, Canada’s Prime Minister Mark Carney confirmed that trade negotiations with the US will resume this week, after the country withdraw the digital services tax that caused the end of negotiations last week.
On Friday, US President Donald Trump announced the suspension of commercial discussions with Canada, complaining about the digital tax, which he called a “direct and flagrant attack on our country (sic).” The US dollar shot after the news, reaching maximum session above 1,3755.
Canada’s economy contracted in April
In the macroeconomic front, an unexpected contraction of Canada’s economy in April increased the bearish pressure over the Canadian dollar. The monthly GDP of Canada contracted 0.1% compared to the expectations of flat performance, with a weak manufacturing activity, highlighting the negative impact of commercial tensions.
The torque, however, seems to have resumed the broader bearish trend, since the appetite for the risk and hopes of a commercial agreement continue to support the CAD, despite the fall in oil prices.
Beyond that, the progress of the broad Trump fiscal bill and the growing hopes of fed cuts in the coming months will probably keep the US dollar on the defensive today, with all the eyes placed in a series of US employment data, which will provide more clues to the flexibility calendar of the US Central Bank.
Economic indicator
Gross Domestic Product (MOM)
The GDP posted by Statistics Canada It is the total value of the goods and services produced in Canada. GDP is considered a measure of global economic activity and indicates the growth rate of the economy of a country. A reading superior to expectations is bullish for Canadian dollar, while a lower reading is bassist.
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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.
