The USDCAD pair continues to trade near the lows of its range and it has been making a few attempts already, over the last couple of days, to break through the lows but that has been unsuccessful so far. It is indeed a large surprise that there has been such a reversal in the fortunes of this pair over the last couple of weeks.
Just 2 weeks back , the pair was trading at the highs of its range near the 1.32 region and the bulls seemed to be firmly in control and looking to push higher as the dollar was surging and the CAD was on the backfoot due to geopolitical factors and also due to the fact that the crude oil prices were taking a hit. But all that has changed over the last couple of weeks with the dollar being on the backfoot and with Canada being exempt from many of the actions that the US has been planning to take, as far as global trade is concerned.
There has also been a growing talk about the Canadians getting a good deal through the changed NAFTA agreement and all these have been very favorable for the CAD. If these events pan out as planned, then we should see the CAD gain in strength even more in due course of time. A big piece of that puzzle would happen later today as the NFP data from the US and the employment data from Canada are going to be released just before the US session begins.
These are 2 important pieces of data and would guide their respective central banks as far as the economic policy in the near future is concerned. The Fed is looking to hike rates while the BOC is known to be a hawkish central bank and for both of them, this piece of data would be very important.
This article was originally posted on FX Empire
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