USDCAD May Fluctuate on BOC Governor’s Speech

USDCAD has been on Bull Run across last week and opened with uptrend momentum during Monday’s trading session. However the price movement has started seeing some fluctuations during late hours of Asian market hours. Currently USDCAD pair is trading at 1.2828 post reaching today’s high at 1.2861. While USD currently seems to be having upper hand against CAD as of now, the pair could be on track for a sharp decline in the USD/CAD pairing. Later this week on 27th April, revised US GDP figures for Q1 2018 will be released. The quarter-on-quarter reading is predicted to be downgraded from 2.9% to 2%. Such a slowdown could unsettle US Dollar traders and weaken the currency, leading to worse USD exchange rates. A GDP downgrade suggests that the US economy has struggled, which could lead to worries that the Federal Reserve will hold off on raising interest rates.

USDCAD Choppy

Despite the potential for a US Dollar to Canadian Dollar (USD/CAD) exchange rate decline at the end of this week, the USD/CAD pairing could recover on 30th April. High-impact US income data will be released over the afternoon, covering changes to personal incomes as well as the pace of personal spending. The readings for March are currently predicted to show no major change to levels of income, but a small increase in spending levels from 0.2% to 0.3%. While minimal, an increase in personal spending could still raise confidence among US Dollar traders and trigger a USD/CAD exchange rate rise. Higher levels of personal spending may eventually lead to rising retail activity in the US, along with an increase in reported GDP.

For Canadian Dollar (CAD) traders, the next event that could affect movement against the US Dollar (USD) will be a speech by the Bank of Canada’s (BOC) Governor. The current head of the BOC, Stephen Poloz, will be making remarks in Ottawa on 25th April, along with Senior Deputy Governor Carolyn Wilkins. If Mr Poloz touches on the issue of monetary policy, particularly on whether there could be an interest rate hike in the coming months, then the CAD could advance. Mr Poloz’s previous remarks have worried CAD traders, particularly when he stated that inflation exceeding the target range wouldn’t guarantee higher interest rates.