October 24, 2024 16:13 GMT
CANADA: USDCAD Probing Post-BoC Highs Amidst Bullish Set-Up
CANADA
- USDCAD has seen a sizeable shunt higher today off earlier lows of 1.3813 to probe yesterday’s 1.3863, a high that came sometime after initially limited reaction to the BoC ramping up its easing cycle with a 50bp cut.
- The technical set-up leans bullish with firmer clearance here opening a key resistance at 1.3946 (Aug 5 high) after which lies the round 1.40. Support meanwhile is seen at 1.3747 (Oct 14 low).
- CAD sits bottom of the G10 FX pack today, with WTI and S&P 500 equity futures both reversing earlier gains and possibly some renewed dovish plays as prospects for a second 50bp cut in December are assessed (despite yield differentials pulling further away from dovish extremes, e.g. 2Y Can-US at -98bps vs -106bps yesterday).
- Data remains in the driving seat for the BoC though, with Canadian retail sales tomorrow offering a first test of the BoC's growth forecast.
- Canada is also going to set its first target for non-permanent resident as part of policy announcements that aim to see population growth slashed to -0.2% in 2025 from 3.0% Y/Y or 2.5% annualized as of Q2.
184 words