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USDCAD Moves Closer To Support Amidst Risk On

CANADA
  • USDCAD has seen a further decline, touching 1.3741, with downward momentum boosted by a recovery in oil and US equity futures.
  • It’s another step closer to support at 1.3730 (50-day EMA) after which lies 1.3657 (Jul 17 low).
  • CAD lags other high beta peers on the day though, rising 0.3% against the USD vs 0.8% for the AUD and larger gains for NZD, NOK and SEK.
  • Gov Macklem on Jul 24 gave a brief preview of today's BoC minutes: “There was clear consensus for the 25bp cut and that the expected path of the policy rate is lower but we’re not on a predetermined path and will take it one meeting at a time. The other element was a broad agreement that inflation will keep coming down but progress could be uneven with setbacks along the way.”
  • Friday’s jobs report should be far more impactful, with historically stretched CAD net shorts sensitive to any hawkish surprises.
  • In case missed yesterday, the Bank has also announced 2025 meeting dates: https://www.bankofcanada.ca/2024/08/bank-canada-publishes-2025-schedule-policy-interest-rate-announcements-other-major-publications/”

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