USD/CAD Drops Even Though US Dollar Rebounds, Canadian Q3 GDP In Focus

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USD/CAD ticks lower as the Canadian Dollar gains on expectations of healthy trade negotiations with the US.

Economists expect the Canadian economy to have grown by 1% in the third quarter of the year.

The US Dollar recovers amid quiet trade on account of Thanksgiving Day.

The USD/CAD pair falls to near the psychological support of 1.4000 in European trading hours on Thursday despite a decent recovery move in the US Dollar (USD). The Loonie asset drops as the Canadian Dollar (CAD) gains on expectations that Canada would manage to negotiate a trade deal with the United States (US).
 Canadian Dollar PRICE TodayThe table below shows the percentage change of Canadian Dollar (CAD) against listed major currencies today. Canadian Dollar was the strongest against the Japanese Yen.

  USD EUR GBP JPY CAD AUD NZD CHF USD   0.28% 0.20% 0.55% -0.12% 0.00% 0.16% 0.27% EUR -0.28%   -0.07% 0.29% -0.39% -0.26% -0.11% 0.00% GBP -0.20% 0.07%   0.35% -0.31% -0.18% -0.04% 0.08% JPY -0.55% -0.29% -0.35%   -0.66% -0.53% -0.42% -0.27% CAD 0.12% 0.39% 0.31% 0.66%   0.14% 0.26% 0.39% AUD -0.01% 0.26% 0.18% 0.53% -0.14%   0.15% 0.27% NZD -0.16% 0.11% 0.04% 0.42% -0.26% -0.15%   0.11% CHF -0.27% -0.00% -0.08% 0.27% -0.39% -0.27% -0.11%  

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Canadian Dollar from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent CAD (base)/USD (quote).US President-elect Donald Trump said in a post on Truth.Social on Monday that he will impose 25% tariffs on Canada and Mexico for providing a freeway to China to supply illicit drugs into the US economy.Canada is a leading supplier of oil, gas, and energy products to the US. A scenario of higher tariffs on Canada would result in a significant decline in foreign flows in their economy, which is negative for the Canadian Dollar (CAD).”Targeting both countries suggests the threat was likely a strategic opening move in renegotiating the existing free trade agreement between the three nations,” said analysts at AscendantFX.However, there will be some impact on the CAD from incoming tariffs in Trump’s administration.This week, investors will focus on the Canadian Q3 Gross Domestic Product (GDP) data, which will be published on Friday. The Canadian economy is estimated to have expanded by 1% compared to the same quarter of the previous year but slower than 2.1% in the previous quarter of the year.Meanwhile, the US Dollar Index (DXY), which gauges the Greenback’s value against six major currencies, bounces back to near 106.40 amid thin trading volume due to a holiday in the US markets on account of Thanksgiving Day.The USD Index will be influenced by market expectations about the Federal Reserve’s (Fed) interest rate action in the December meeting. According to the CME FedWatch tool, there is a 70% chance that the Fed will cut interest rates by 25 basis points (bps) to 4.25%-4.50% next month, according to the CME FedWatch tool.More By This Author:USD/CAD Turns Subdued After Mid-Tier US Data Release Pound Sterling Struggles Against US Dollar On Renewed Trump Tariff Fears AUD/USD Gives Of Intraday Gains, Aussie/US Inflation In Focus