USD/CAD Daily Fundamental Forecast – November 8, 2017
Like many other pairs in the market yesterday, the USDCAD pair also spent most of the day chopping around and it has turned weak as of this morning as the varying reports of the tax reform bill in the US has been pushing and prodding the dollar here and there. This has led the pair lower and it trades just below the 1.2750 region as of this writing and looks good for more choppy trading for the short term.
USDCAD In Choppy Mode
There has not been much data or news events around the global markets and this is being reflected in the FX markets as well which has been chopping around with no specific direction. The dollar has been driven by the expectations of a rate hike from the Fed in December and though, so far, there has been neither a confirmation or a rebuttal of this from the Fed or from the incoming data. This has led the markets to believe that a hike is on the way and that is being currently priced in slowly and steadily.
Also, the tax reform bill seems to be getting into final shape and there are also reports that say that the implementation of the tax reform bill could be delayed by about a year. This would not be good for the dollar in the short term and based on this unconfirmed news, the dollar has been moving lower since the morning. On the other hand, the CAD has been holding steady as the oil prices continue to trade in a strong manner and the incoming data from Canada has also been pretty strong which has been able to support the CAD.
Looking ahead to the rest of the day, expect the choppy trading to continue between the 1.27 and 1.28 as the market looks for the next direction from somewhere. With the lack of news, this week might be dominated by such choppy trading.