USD/CAD remains steady near 1.3900 with US GDP data on focus

• The US Dollar retreated from highs above 1.3900 against the CAD, but remains steady above 1.3885.
• Investors have remained cautious on Thursday, awaiting US GDP data and more Fed speeches.
• The highlight of the week is Friday's PCE Prices index release, the Fed's favorite inflation gauge.
  

The US Dollar has been trading within a narrow range near the 1.3900 level on Thursday, with downside attempts held at 1.3885. The cautious market mood amid ongoing gei¡opolitical risks and a not-so-dovish rhetoric by Fed speakers is keeping US Dollar bears at bay for now.

The focus now is on the final reading of the US second quarter's Gross Domestic Product, which is expected to confirm that a rebound to a 3.3% annualised growth after the 0.5% contraction seen in the first three months of the year.

Later on, another batch of Fed speakers might provide further clues about the central bank's monetary policy plans. The highlight of the week, however, will be Friday's Personal Consumption Expenditures (PCE) Price Index, which will be analyzed with interest for more evidence of the inflationary impact of Trump's tariffs.

On Wednesday, San Francisco Fed President Mary Daly confirmed that the bank will have to ease its monetary policy further, but she warned that the next rate cut might take some time, as the bank needs to balance its two mandates, promoting employment and keeping inflation at low levels.

Canada's economic docket has been thin this week, but BoC Governor, Tiff Macklem, highlighted shifts in global trade and financial flows as the main threats to Canada's growth and warned that inflation would go up as a consequence of the trade frictions with the US