USD/CAD remains depressed near 1.3600 ahead of US PMI, Jobless Claims data

• The US Dollar remains weighed near lows on risk-on markets.
• Investors are celebrating an imminent trade deal with the E,U which would bring more clarity to the global trade outlook.
• Later today, US PMIs and Jobless Claims, and Canada's Retail Sales will provide further fundamental guidance.

The US Dollar is ticking higher against the Canadian Dollar on Thursday and has risen above 1.3600, although it remains close to one-year lows at the 1.3540 area, driven by risk-on markets, following the release of US preliminary PMIs and weekly Jobless Claims data.

News of advances in a EU-US trade deal, which would include 15% tariffs and exemptions for automobiles, medical equipment, and alcohol, has boosted the market mood in Asia and Europe, keeping the safe-haven US Dollar on the defensive.

This news follows a trade deal with Japan and another with the Philippines and Indonesia on Wednesday, and US Treasury Secretary Bessent has announced a new round of talks with China for next week. Hopes that the worst of trade tariffs can be averted are boosting investors' appetite for risk.

US PMIs and Jobless Claims data in the spotlight

In the calendar today, US preliminary PMIs are expected to show that business economic activity in both the services and manufacturing sectors expanded in July, highlighting a strong economic momentum, yet with Jobless Claims increasing.

Later today, President Trump is expected to visit the Federal Reserve amid a fierce campaign against Chairman Powell and only a few days ahead of July's meeting. It is unclear whether the President will meet Powell, but there is the feeling that he will be increasing pressure on the bank to cut rates further.

In Canada, the focus will be on May's Retail Sales figures, which are expected to have contracted, with the core reading, excluding automobiles, is falling for the third consecutive month. These numbers hint at further BoC monetary easing, and are unlikely to provide any significant support to the Loonie.