USD/CAD Daily Fundamental Forecast – June 19, 2017

USDCAD trades in a weak manner as of this morning which is something that it continues to do from where it left off last week. We have seen the pair become progressively weaker on the back of the US dollar being just steady while the CAD continues to get stronger and stronger by the day. In fact, the strength of the CAD has been so much that even the fall in the oil prices has been ignored in general and the CAD has continued to progress against all the other currencies.

USDCAD To Remain Under Pressure

The USDCAD fell through the important support region at around 1.3500 a couple of weeks back and since that time, we have been saying that this break through has marked a shift in the trend of this pair and we have been proved right as the pair continues in a downtrend over the last couple of weeks. Last week, we had the BOC No. 2 Wilkins says that she believes that the rate cut cycle that began in 2015 has served it purpose and that the BOC would now look to bring in a change in that cycle.

This is the clearest signal as yet that the BOC is looking at hiking rates as its confidence in the economy has been boosted by the strong incoming data over the last couple of months. The turn in the economy has boosted the CAD and now the market is likely to watch the incoming data even more closely and look out for statements from the BOC members to look at the possibility of a rate hike this year. All these events have been supportive of the CAD and that is why we have been seeing the USDCAD under pressure.

Looking ahead to the rest of the day, we do not have any major economic news from US or Canada and so expect some consolidation on either side of 1.32 for the day.