- Broad market risk appetite recovers on Friday as US PCE inflation declines.
- In Canada, the GDP rebound was weaker than expected.
- US PCE inflation cooled further, fueling hopes for interest rate cuts.
The Canadian dollar (CAD) rose sharply on Friday, but gains were circumscribed after worse-than-expected Canadian economic data. Investor hopes for a September rate cut are rising after U.S. Personal Consumer Expenditures (PCE) price index inflation fell faster than expected and interest rate markets are once again pricing in a better-than-even chance of a Federal Reserve (Fed) rate cut. .
Canada saw a smaller rebound in quarterly gross domestic product (GDP) growth than markets expected, limiting overall CAD gains. As US inflation headlines drive broader markets, end-of-week risk sentiment will be high, with investors paying attention to next week’s Bank of Canada (BoC) interest rate call as well as the US Purchasing Managers’ Index (PMI) series. . printouts and subsequent payrolls in the non-agricultural sector next Friday.
Daily Market Change Summary: Canadian Dollar Boosted by Rising Risk Appetite
- Canadian GDP for the first quarter rose to its strongest growth in a year, rising 1.7% on a quarterly basis despite missing market forecasts of 2.2%.
- GDP for the previous quarter was also revised significantly downwards to just 0.1% compared to the original print of 1.0%.
- US PCE price index inflation increased by 0.2% m/m in April, below the forecast of 0.3%.
- U.S. personal spending was significantly lower in April, coming in at 0.2% compared to the 0.3% forecast and even further off the previous 0.7% (adjusted from 0.8%).
- According to CME’s FedWatch Tool, interest rate markets are currently pricing in a 56% probability of at least a quarter-point interest rate cut by the Fed in September.
Canadian DOLLAR PRICE today
The table below shows the current percentage change of the Canadian Dollar (CAD) against the major listed currencies. The Canadian dollar was strongest against the Japanese yen.
| USD | EUR | GBP | JPY | BOOR | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.15% | -0.10% | 0.28% | -0.39% | -0.30% | -0.46% | 0.05% | |
| EUR | 0.15% | 0.07% | 0.39% | -0.27% | -0.16% | -0.34% | 0.19% | |
| GBP | 0.10% | -0.07% | 0.34% | -0.33% | -0.23% | -0.43% | -0.03% | |
| JPY | -0.28% | -0.39% | -0.34% | -0.70% | -0.60% | -0.81% | -0.43% | |
| BOOR | 0.39% | 0.27% | 0.33% | 0.70% | 0.08% | -0.07% | 0.26% | |
| AUD | 0.30% | 0.16% | 0.23% | 0.60% | -0.08% | -0.17% | 0.15% | |
| NZD | 0.46% | 0.34% | 0.43% | 0.81% | 0.07% | 0.17% | 0.37% | |
| CHF | -0.05% | -0.19% | 0.03% | 0.43% | -0.26% | -0.15% | -0.37% |
The heat map shows the percentage changes of the major currencies relative to each other. The base currency is selected from the left column and the quote currency from the top row. For example, if you select the Canadian dollar from the left column and move along the horizontal line to the US dollar, the percentage change displayed in the box will represent CAD (basis)/USD (quote).
Technical analysis: Canadian dollar significantly higher but still mired in technical constraints
The Canadian dollar (CAD) gained broadly on Friday, rising half a percent against the Japanese yen (JPY). The CAD also rose by more than a third of a percent on the day against both the pound sterling (GBP) and the US dollar (USD).
USD/CAD has returned to the 1.3630 area as the pair oscillates at the lower end of a short-term congestion pattern. Short session momentum continues to struggle to find territory near 1.3600, but bidders have failed to bring prices back above 1.3750.
