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The Canadian greenback is barely greater on Thursday. USD/CAD is buying and selling at 1.3537 within the North American session, down 0.23%.
Canada’s GDP rebounds with 0.6% achieve
Canada’s GDP bounced again with a powerful achieve of 0.6% m/m in January, after a 0.1% in December. This beat the market estimate of 0.4%. The preliminary estimate for February’s GDP stands at 0.4%, which implies that thus far, development within the first quarter is wanting strong. It is a main turnaround for the Canadian economic system, which narrowly averted a technical recession within the second half of 2023.
The Financial institution of Canada meets subsequent on April tenth and the advance in GDP would assist the BoC taking its time earlier than reducing charges. The BoC has held the benchmark price at 5% six straight occasions and is searching for the economic system to chill and inflation to fall additional earlier than it lowers charges. On the similar time, households are groaning underneath the load of excessive rates of interest, which is placing some stress on the BoC to supply some aid by decreasing charges.
US GDP revised to three.4%
The US additionally launched GDP for the fourth quarter, with the third and closing estimate being revised upwards to three.4% y/y, up from 3.2% within the second estimate and beating the market estimate of three.2%. The GDP launch was respectable however sharply decrease than the 4.9% achieve in Q3, which signifies that the US economic system is cooling down because of elevated rates of interest.
The Federal Reserve has sounded extra hawkish about price coverage these days. Fed Governor Christopher Waller stated on Wednesday that inflation had not fallen as shortly as anticipated and “there isn’t a rush to chop the coverage price”. Earlier within the week, Atlanta Fed President Rafael Bostic lowered his forecast to only one price reduce in 2024, after saying in February that he anticipated two price cuts this yr.
USD/CAD Technical
USD/CAD is testing assist at 1.3559. Under, there may be assist at 1.3503
1.3661 and 1.3717 are the subsequent resistance traces
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