The USD/CAD slightly dropped on Thursday despite the severe weakness of the U.S. dollar, where the U.S. dollar dropped against most majors after the Fed confirmed they will continue with the loose monetary policy, nevertheless, falling oil prices and concerns over the Federal elections in Canada next week weighed down on the Canadian dollar, thus, the pair didn’t have the momentum to drop strongly.
Investors and traders will probably remain cautious ahead of the elections, where the National Democratic Party seems to have gained strong momentum recently, and it remains to be seen whether the current ruling Conservative Party will win the elections or not.
Accordingly, it seems that the pair will continue to fluctuate over the upcoming few days, although we still preserve our downside projection for the pair. We should note that important data will be released from both the United States and Canada on Friday, and accordingly, we should expect volatility to dominate the USD/CAD movement.
Friday 12:30, Canada will release the Gross Domestic Product for the month of February, where the Canadian economy expanded in January by 0.5% and 3.3% on monthly and yearly basis, and expectations show that economic growth was flat in February, while on early basis, the Canadian economy is expected to expand by 3.1%
Friday 12:30, the United States will release the Income Report for the month of March, where personal income is expected to rise by 0.4%, compared with the prior rise of 0.3% in February, while personal spending is expected to rise by 0.5%, compared with 0.7% in February.
Core PCE is expected to rise in March by 0.1% and 0.9% on monthly and year basis respectively, compared with 0.2% and 0.9% on monthly and yearly basis respectively, although we might witness an upside surprise, since rising energy prices over the past few months started to be reflected through higher inflation rates all around the globe.
Friday 13:45, the Chicago PMI will be released for the month of April, where the Chicago PMI is expected to show that manufacturing activities eased in April to 68.2, compared with 70.6 reported in March.
Friday 13:55, the University of Michigan will release the final estimate for Consumer Confidence in April, where consumer confidence is expected to improve to 70.0 from 69.6 reported in the preliminary estimate.
Written by ForexMansion.com