The USD/CAD currency pair today suffered a major decline after the release of both US and Canadian macro data during the North American session. Some of the macro data released by both countries include Canada’s GDP data released by Statistics Canada and the US initial jobless claims report.
The currency pair came under intense selling pressure during the early North American session and lost over 120 points at the height of its decline.
The release of positive Canadian quarterly GDP data triggered the massive decline as it came in at an annualized rate of 4.5% versus the market expectation of 3.7%. The rising crude oil prices, as traced by the West Texas Intermediate, also boosted the commodity-linked loonie. The release of positive US initial jobless claims by the Department of Labor provided a brief respite to the pair, but the downward trend was too strong for the positive data.
The release of the US personal income data and the core personal consumption expenditure by the Bureau of Economic Analysis could not stop the decline. The personal income figure for July recorded a 0.4% increase versus the expected 0.3% and the previous 0.00%. The PCE data came in at 1.4%, hence meeting expectations. The negative pending home sales data also drove the pair lower.
The currency pair’s future performance is likely to be affected by the release of the Markit Canada Manufacturing PMI and the US non-farm payrolls, both scheduled for tomorrow.
The USD/CAD currency pair was trading at 1.2549 as at 14:38 GMT having declined from a high of 1.2662. The CAD/JPY pair was trading at 87.82 having rallied from a low of 87.30.
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