It’s a relatively quiet day ahead on the economic calendar. The RBA delivers its August policy decision later this morning, which will be the main event of the day, however.
US yields slide
Canada is becoming an increasingly viable alternative to the U.S. dollar making it more important in the forex market.
USD/CAD managed to settle above 1.2480 and is trying to settle above the resistance level at 1.2500.
USD/CAD settled back above 1.2450 and is testing the resistance level at 1.2480.
The Canadian dollar edged up against its U.S. counterpart on Friday, with the currency holding onto this week's gains as a preliminary estimate showed Canada's economy rebounding in June. It was on track to advance for the second straight week, with a gain of 1%, as dovish remarks by the U.S. Federal Reserve took the steam out of a month-long rally for the U.S. dollar. The Canadian economy most likely expanded by 0.7% in June as businesses reopened after shutdowns imposed to help fight the coronavirus pandemic, Statistics Canada said.
It’s a busy day ahead on the economic calendar. Economic data from the Eurozone, Canada, and the U.S will be in focus today.
jobless claims rise more than expected
The Canadian dollar rose against its U.S. counterpart on Thursday as the dollar tumbled to a month low after the Federal Reserve reiterated that the interest rate will remain zero for a long time.
The Canadian dollar touched a two-week high against its broadly weaker U.S. counterpart on Thursday, as the Federal Reserve remained patient about reducing stimulus and the Bank of Canada reassured Canadians it would keep inflation under control. "The Fed continued to support markets yesterday with upbeat talk on the economy but not committing to cutting stimulus in the near term," Colin Cieszynski, chief market strategist at SIA Wealth Management, said in a note. Canada sends about 75% of its exports to the United States including oil.