Created
: 2024.10.31
- English
- English
- What's Myforex
- Share
- Use tools
- Get information
- What's New
- Help center
- About us
- Customer support
- Terms and policies
-
-
PortfolioShare your portfolio and performance in real time -
Events & contestsEvents and contests held by retail brokers around the world
-
-
Real-time spread comparisonCompare spreads of major retail brokers in real time -
Volatility analysisVisualize volatility as a measure of daily market activity -
Swap point comparisonCompare buy and sell swap values for each broker by symbol -
Market rates & chartsCheck prices for all instruments offered by each broker -
IndicatorsProviding in-house developed indicators for MT4/MT5 -
Trading calculatorsCalculation tools for each broker to help you trade
-
-
World FX newsLatest news on forex and cryptocurrencies from around the world -
Broker informationTrading information of retail brokers worldwide -
MetaTrader4/5 user guideUser guide collection for the latest MetaTrader4/5 -
Economic calendarRelease calendar for indicators from official sources of major economies
USD/CAD hovers around three-month highs near 1.3950, awaits US PCE inflation, Canada GDP
World FX news
Breaking news
USD/CAD hovers around three-month highs near 1.3950, awaits US PCE inflation, Canada GDP
New
2024.10.31 12:35
2024.10.31 12:35
2024.10.31 12:35
- USD/CAD maintains its position around a three-month high at 1.3940, marked on Wednesday.
- US GDP annualized expanded by 2.8% in Q3, below 3.0% in Q2 and forecasts of 3.0%.
- Traders will closely observe US PCE - Price Index and Canada's Gross Domestic Product data on Thursday.
USD/CAD appreciates to near its three-month high of 1.3940, recorded in the previous session, trading around 1.3920 during Thursday's European session. This upside of the pair could be linked to the solid US Dollar (USD) as market caution lingers amid uncertainty surrounding the upcoming US presidential election.
Traders are now focusing on upcoming key US data releases including PCE inflation data on Thursday and Nonfarm Payrolls (NFP) on Friday. On Wednesday, the Greenback encountered headwinds as the US Gross Domestic Product (GDP) annualized expanded by 2.8% in Q3, below 3.0% in Q2 and forecasts of 3.0%.
However, the ADP Employment Change report showed that private businesses in the United States added 233,000 workers in October, marking the largest increase since July 2023. This followed an upward revision to 159,000 in September and significantly exceeded forecasts of 115,000.
The commodity-linked Canadian Dollar (CAD) might have received support from stronger Oil prices, as Canada remains the largest crude supplier to the United States (US). crude prices found support amid optimism surrounding US fuel demand after an unexpected decline in crude inventories. West Texas Intermediate (WTI) Oil price trades around $68.70 at the time of writing.
The US Energy Information Administration (EIA) reported that crude Oil stockpiles fell by 0.515 million barrels in the week ending October 25, contrary to market expectations of a 2.3 million-barrel increase.
Bank of Canada Governor Tiff Macklem addressed the House of Commons Finance Committee on Wednesday to discuss the bank's monetary policy. Macklem stated that if the economy aligns broadly with their forecast, they expect to cut the policy rate further to support demand and maintain inflation on target.
Canadian Dollar FAQs
The key factors driving the Canadian Dollar (CAD) are the level of interest rates set by the Bank of Canada (BoC), the price of Oil, Canada's largest export, the health of its economy, inflation and the Trade Balance, which is the difference between the value of Canada's exports versus its imports. Other factors include market sentiment - whether investors are taking on more risky assets (risk-on) or seeking safe-havens (risk-off) - with risk-on being CAD-positive. As its largest trading partner, the health of the US economy is also a key factor influencing the Canadian Dollar.
The Bank of Canada (BoC) has a significant influence on the Canadian Dollar by setting the level of interest rates that banks can lend to one another. This influences the level of interest rates for everyone. The main goal of the BoC is to maintain inflation at 1-3% by adjusting interest rates up or down. Relatively higher interest rates tend to be positive for the CAD. The Bank of Canada can also use quantitative easing and tightening to influence credit conditions, with the former CAD-negative and the latter CAD-positive.
The price of Oil is a key factor impacting the value of the Canadian Dollar. Petroleum is Canada's biggest export, so Oil price tends to have an immediate impact on the CAD value. Generally, if Oil price rises CAD also goes up, as aggregate demand for the currency increases. The opposite is the case if the price of Oil falls. Higher Oil prices also tend to result in a greater likelihood of a positive Trade Balance, which is also supportive of the CAD.
While inflation had always traditionally been thought of as a negative factor for a currency since it lowers the value of money, the opposite has actually been the case in modern times with the relaxation of cross-border capital controls. Higher inflation tends to lead central banks to put up interest rates which attracts more capital inflows from global investors seeking a lucrative place to keep their money. This increases demand for the local currency, which in Canada's case is the Canadian Dollar.
Macroeconomic data releases gauge the health of the economy and can have an impact on the Canadian Dollar. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the CAD. A strong economy is good for the Canadian Dollar. Not only does it attract more foreign investment but it may encourage the Bank of Canada to put up interest rates, leading to a stronger currency. If economic data is weak, however, the CAD is likely to fall.
Last updated
: 2024.10.31
Related articles
WTI remains above $70.00, upside potential appears due to rising Middle-East tensions
2024.11.01 11:53Are crude oil markets fairly valued? - TDS
2024.10.31 22:19USD/CAD hovers around three-month highs near 1.3950, awaits US PCE inflation, Canada GDP
2024.10.31 12:34WTI remains below $69.00, upside potential appears due to US Oil demand
2024.10.31 12:04USD/CAD remains above 1.3900 near three-month highs, eyes on US GDP
2024.10.30 18:10WTI stabilizes around $67.50 following a surprise drop in US stockpiles
2024.10.30 11:26
FXStreet is a forex information website, delivering market analysis and news articles 24/7.
It features a number of articles contributed by well-known analysts, in addition to the ones by its editorial team.
Founded in 2000 by Francesc Riverola, a Spanish economist, it has grown to become a world-renowned information website.
Was this article helpful?
We hope you find this article useful. Any comments or suggestions will be greatly appreciated.
We are also looking for writers with extensive experience in forex and crypto to join us.
please contact us at [email protected].
Thank you for your feedback.
Thank you for your feedback.
Most viewed
AUD/JPY inches lower to near 100, upside potential remains supported by hawkish RBA
The AUD/JPY pair remains subdued for the second day, hovering around 100.00 during the European session after the release of mixed Q3 Producer Price Index (PPI) data on Friday.
New
2024.11.01 16:27EUR/GBP remains below 0.8450, downside seems limited due to less dovish ECB
EUR/GBP inches lower after two days of gains, trading around 0.8430 during the early European hours on Friday.
New
2024.11.01 15:56USD/CHF trades firmer to near 0.8650 as traders await the US NFP data
The USD/CHF pair gathers strength to near 0.8640 during the early European session on Friday.
New
2024.11.01 15:27EUR/USD edges lower around 1.0850 due to market caution ahead of US Nonfarm Payrolls
EUR/USD halts its four-day winning streak, trading around 1.0870 during the Asian session on Friday.
New
2024.11.01 15:13Forex Today: Market attention turns to US October employment data
Here is what you need to know on Friday, November 1: The US Dollar (USD) stays resilient against its rivals early Friday, with the USD Index holding steady near 104.00 following a three-day slide.
New
2024.11.01 15:05US Nonfarm Payrolls Forecast: NFP October report set to show slower job growth
All eyes are on the market-moving Nonfarm Payrolls (NFP) data for October, to be released by the United States Bureau of Labor Statistics (BLS) on Friday at 12:30 GMT.
New
2024.11.01 15:00USD/CAD trades with mild losses below 1.3950, US NFP data looms
The USD/CAD pair loses momentum to around 1.3925 during the early European trading hours on Friday.
New
2024.11.01 14:12NZD/USD maintains position above 0.5950 following China Manufacturing PMI
NZD/USD remains stable for the third consecutive session, trading around 0.5980 during the Asian hours on Friday.
New
2024.11.01 13:59India Gold price today: Gold rises, according to FXStreet data
Gold prices rose in India on Friday, according to data compiled by FXStreet.
New
2024.11.01 13:36Japanese Yen loses ground as manufacturing production continues to decline
The Japanese Yen (JPY) retraces some of its recent gains following the release of the Manufacturing Purchasing Managers Index (PMI) by Jibun Bank and S&P Global on Friday.
New
2024.11.01 13:35Disclaimer:
All information and content provided on this website is provided for informational purposes only and is not intended to solicit any investment. Although all efforts are made in order to ensure that the information is correct, no guarantee is provided for the accuracy of any content on this website. Any decision made shall be the responsibility of the investor and Myforex does not take any responsibility whatsoever regarding the use of any information provided herein.
The content provided on this website belongs to Myforex and, where stated, the relevant licensors. All rights are reserved by Myforex and the relevant licensors, and no content of this website, whether in full or in part, shall be copied or displayed elsewhere without the explicit written permission of the relevant copyright holder. If you wish to use any part of the content provided on this website, please ensure that you contact Myforex.
Myforex uses cookies to improve the convenience and functionality of this website. This website may include cookies not only by us but also by third parties (advertisers, log analysts, etc.) for the purpose of tracking the activities of users. Cookie policy
