Current Pair Status: The USD/CAD pair is experiencing a loss of momentum during the Asian session, trading at 1.3749, consolidating from the weekly low of 1.3655.
US Economic Data: The recent US economic data, particularly the rise in Initial Claims and Continuing Jobless Claims, may be influencing the market sentiment. The higher-than-expected jobless claims could raise concerns about the strength of the US economy.
Federal Reserve Expectations: Market participants are anticipating that the Federal Reserve may be done with its tightening cycle, and there are expectations of a rate cut in mid-2024. This sentiment could potentially weigh on the US Dollar (USD) and limit the upside for the USD/CAD pair.
Canadian Real Estate: The decline in house sales in Canada, as reported by the Canadian Real Estate Association (CREA), is attributed to rising borrowing rates, which may be impacting consumer behavior. The Bank of Canada's warning about higher borrowing rates further adds to the economic landscape.
Oil Prices: The decline in oil prices could benefit the Canadian Dollar (CAD), as Canada is a significant oil exporter to the US. The Loonie is considered a commodity-linked currency, and changes in oil prices often influence its value.
Upcoming Economic Events: Market participants are likely to focus on upcoming US housing data, specifically Building Permits and Housing Starts. Additionally, the Canadian Industrial Product Price Index and Raw Materials Price Index are expected on Friday, and these releases could provide further direction for the USD/CAD pair.
In summary, the USD/CAD pair seems to be influenced by a combination of economic data, expectations regarding the Federal Reserve's monetary policy, the Canadian real estate market, and oil prices. Traders will likely monitor upcoming economic releases for additional insights and potential market direction.
US Economic Data: The recent US economic data, particularly the rise in Initial Claims and Continuing Jobless Claims, may be influencing the market sentiment. The higher-than-expected jobless claims could raise concerns about the strength of the US economy.
Federal Reserve Expectations: Market participants are anticipating that the Federal Reserve may be done with its tightening cycle, and there are expectations of a rate cut in mid-2024. This sentiment could potentially weigh on the US Dollar (USD) and limit the upside for the USD/CAD pair.
Canadian Real Estate: The decline in house sales in Canada, as reported by the Canadian Real Estate Association (CREA), is attributed to rising borrowing rates, which may be impacting consumer behavior. The Bank of Canada's warning about higher borrowing rates further adds to the economic landscape.
Oil Prices: The decline in oil prices could benefit the Canadian Dollar (CAD), as Canada is a significant oil exporter to the US. The Loonie is considered a commodity-linked currency, and changes in oil prices often influence its value.
Upcoming Economic Events: Market participants are likely to focus on upcoming US housing data, specifically Building Permits and Housing Starts. Additionally, the Canadian Industrial Product Price Index and Raw Materials Price Index are expected on Friday, and these releases could provide further direction for the USD/CAD pair.
In summary, the USD/CAD pair seems to be influenced by a combination of economic data, expectations regarding the Federal Reserve's monetary policy, the Canadian real estate market, and oil prices. Traders will likely monitor upcoming economic releases for additional insights and potential market direction.
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