Canadian Dollar consolidates near 1.3900 vs USD ahead of US tariffs deadline, FOMC Minutes
The USD/CAD pair struggles to capitalize on this week's modest recovery from its lowest level since June 3 and oscillates in a range around the 1.3900 mark during the Asian session on Wednesday.
The Canadian Dollar remains stable near the 1.3900 level against the US Dollar as markets await the US tariffs deadline and the Federal Open Market Committee (FOMC) Minutes release. Traders hesitate to take significant positions due to the uncertainty surrounding the talks between US President Donald Trump and Canadian Prime Minister Mark Carney to prevent 50% tariffs on $20 billion worth of Canadian goods.
The US Dollar is supported by the looming deadline and higher oil prices, while a strong US economy adds pressure on the Canadian currency. The Bank of Canada's interest rate decisions and the price of oil, Canada's top export, significantly impact the value of the Canadian Dollar. Higher oil prices and higher interest rates from the Bank of Canada tend to strengthen the Canadian Dollar.
Analysts advise waiting for strong buying confirmation before expecting further appreciation of the USD/CAD pair, which is currently supported by the 50.00% Fibonacci retracement and the 200-day Simple Moving Average.
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