USDCAD drifted lower in New York trading as positions were trimmed ahead of the GDP data. January GDP rose 0.1% as expected. It is considered soft by many analysts as it indicates weaker domestic growth. Prices popped back to 1.2930 before easing back. USDCAD will be underpinned until the 1600 GMT fix is out of the way.
US data was ok. Initial Jobless Claims were 215,000 vs forecast of 230,000 Personal Income and Spending were as forecast.For some Christians, Maundy Thursday is a big deal. It is a public holiday in Denmark, Norway, many regions of Spain and for many Latin American and South American nations. But not In Canada, the US or the UK. However, bond traders are either religious or practical. The bond market closes today at 1:00 pm so traders can get an early start on their Easter Egg hunt.
FX markets opened in New York little changed from yesterday’s closing levels. NZDUSD was the worst performer while the Japanese yen was the biggest gainer. Neither of the moves was significant. However, FX markets are very different from what they looked like at the start of 2018. The Canadian dollar is the biggest loser, down 2.7% since the close on December 29, 2017. The Japanese yen outperformed the majors, rising 5.4%, followed by Sterling which posted a 4.2% gain.
The weakness of the US dollar is odd. The Fed is raising rates with many economists predicting another three rate hikes in 2017. Meanwhile, wishful thinking and the mere speculation of policy tightening in other G10 countries have underpinned many of the other majors.
UK Q4 GDP rose 0.4%, q/q which was expected and Total Investment ticked higher. National House Prices were lower, and no one cared. GBPUSD drifted in a 1.4037-94 range.
It was a similar story in the Eurozone. EURUSD stayed in a narrow 1.2296-1.2334 band, with traders ignoring better the German employment report.
USDCAD Technical Outlook
The intraday USDCAD technicals are rangebound inside a 1.2820-1.2920 band. A break above 1.2920 targets 1.2980 and then 1.3020. For today, USDCAD support is at 1.2850 and 1.2820. Resistance is at 1.2920 and 1.2950
Today’s Range: 1.2860-1.2940.