Canadian Dollar: Trade war clouds Q2 GDP rebound – BBH
Brown Brothers Harriman’s (BBH) Elias Haddad notes USD/CAD is trading just above its 200‑day moving average near 1.3840 as Canada’s Q2 GDP is expected to rebound strongly, with real GDP seen rising 3.4% SAAR versus a slight Q1 contraction.
Brown Brothers Harriman’s Elias Haddad observes USD/CAD trading near 1.3840, its 200-day moving average. Canada's Q2 GDP growth is projected at 3.4% SAAR, after a minor Q1 decline. However, a deteriorating US-Canada trade conflict could curtail the rebound. The Bank of Canada's (BoC) rate hike expectations appear overly ambitious, with USD/CAD potentially strengthening to near 1.4000.
Core inflation near 2% provides the BoC with room to maintain a wait-and-see stance, cushioning the economy. Meanwhile, GBP/USD consolidates after a rejection at 1.3600, awaiting US Nonfarm Payrolls and Fed Chair Jerome Powell's Jackson Hole speech. EUR/USD hovers around 1.1650 amid US Dollar strength, but may face downside pressure from hawkish European Central Bank (ECB) cues.
Gold rises for the second day in a row, hovering around $4,610 near an ascending channel, signaling a bullish outlook. Hyperliquid's shares dip 2% after raising $650 million for a 29.3 million token stake in Hyperliquid Strategies Inc. Meanwhile, Federal Reserve Chair Kevin Warsh prepares to address the Jackson Hole Symposium, with expectations extending beyond rate decisions in September.
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