CAD GDP Preview: what to expect OF USD/CAD

Canadian GDP figures are up next. Prior surveys expect the economy to have expanded 0.4% inter-month in June, while it is seen contracting at an annualized 1.5% on a quarterly basis in Q2.

According to ‘Rates, FX and Commodities Research’ at TD Securities, “After a healthy start to the year, the Canadian economy appears to have taken a step backwards in the second quarter with a forecasted contraction of 1.5% on an annualized quarterly basis. What was already shaping up to be a weak quarter was made worse by May's wildfires in Alberta and nearly all details of the report are likely to be soft”.

In the FX space, the pair is extending its upside above the 1.3100 barrier today, advancing for the second consecutive week so far and once again breaking above the base of the 4-month rising channel, although this time it seems a more convincing breakout. The next target appears at 1.3202 (August’s top) ahead of the key 200-day sma currently at 1.3287.