Home Daily Commentaries The USD/CAD continues to trade within tight range following economic data releases

The USD/CAD continues to trade within tight range following economic data releases

Friday 29 July, 2022

Daily Currency Update

Economic growth in Canada came in at 5.6%, which was slightly more robust than the expected number of 5.4%. Initially, the Loonie crosses versus G10 currencies rallied. For example, the USDCAD fell towards 1.2800 three hours after the GDP release. However, the Loonie has since started to lose some momentum. The reality is that, overall, Canada's economic growth is showing signs of losing some positive momentum following a solid start to the year in spite of rising interest rates.

Key Movers

The Friday session in Asia started strong thanks to a favorable risk backdrop and a weaker USD in the overnight session, along with S&P 500 futures increasing. The Federal Reserve Bank of Atlanta's GDPNow Index suggests that GDP will expand by 2.1% in the third quarter. US personal income and personal spending came in stronger than expected, 0.6% vs 0.5% and 1.1% vs 1%, respectively. For now, many analysts think that for the USD to weaken, the Fed has to show more concern about economic growth than inflation. In other news, the Mexican Peso fell against the USD after five straight days of gains.

Expected Ranges

  • EUR/CAD: 1.3031 - 1.3131 ▲
  • GBP/CAD: 1.5503 - 1.5658 ▼
  • AUD/CAD: 0.8889 - 0.8990 ▲
  • USD/CAD: 1.2791 - 1.2852 ▼