Canadian Dollar trades near a critical technical threshold as traders await second quarter GDP data expected to show robust economic recovery. USD/CAD is hovering just above its 200-day moving average at 1.3840, with Brown Brothers Harriman analyst Elias Haddad monitoring the pair closely ahead of the Canadian GDP release. Economists forecast real GDP growth of 3.4 percent on a seasonally adjusted annualized rate for Q2, marking a sharp turnaround from the modest contraction recorded in the first quarter.
The anticipated rebound comes as trade war uncertainty threatens to dampen Canada’s economic outlook going forward. While the strong quarterly figures could provide temporary support for the loonie, ongoing tensions and tariff disputes with major trading partners may limit any sustained rally. Traders are watching whether the GDP beat can push USD/CAD below key technical support or if trade concerns will keep pressure on the Canadian currency.
FXnCO Insight
Watch the 200-day moving average at 1.3840 as a critical inflection point for USD/CAD positioning following the GDP release.
Source: FXStreet