Canadian Dollar (CAD) Rebounds Against US Dollar Amid Thin Market Flows
The Canadian Dollar (CAD) experienced a sharp decline against the US Dollar on Monday, followed by a moderate recovery later in the day. Despite the positive turnaround, market flows remain thin due to the Canadian holiday for the August Civic Holiday.
Looking ahead, CAD traders are anticipating significant economic data releases later in the week, particularly July’s updated labor figures on Friday. While some mid-tier data from Canada is expected midweek, its impact is likely to be limited.
Market Analysis: CAD Flows Take a Backseat Amid US Data Concerns
- US S&P Global Composite Purchasing Managers Index (PMI) figures for July fell to 54.3, below the expected 55.0.
- Fears of a US recession heightened after recent data misses, including Friday’s US Nonfarm Payrolls (NFP) report.
- Market anticipates a Federal Reserve (Fed) rate cut in September.
- July ISM Services PMI exceeded expectations at 51.1.
- CAD traders await Friday’s Net Change in Employment data for potential market impact.
Canadian Dollar Strength Today
The Canadian Dollar (CAD) showed strength against major currencies today, with the highest performance against the British Pound.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.33% | 0.41% | -1.50% | -0.18% | 0.32% | 0.41% | -0.56% |
Canadian Dollar Technical Outlook
The Canadian Dollar (CAD) initially weakened against the US Dollar before bouncing back, while the market holiday led to mixed trading. USD/CAD hit a new high for 2024 before retreating slightly. The pair’s price action remains volatile, with a struggle to sustain momentum for a bullish trend.
Canadian Dollar FAQs
Key factors influencing the Canadian Dollar include interest rates set by the Bank of Canada, Oil prices, economic health, inflation, and trade balance. The US economy also plays a significant role in CAD movements.