The Canadian economy disappointed in August and squeezed by 0.1%. Expectations stood on another month of steady growth of 0.2%.Â
The disappointing figure sent USD/CAD to a second battle with parity this week. Will it stay above the line this time?
Canada’s economy enjoyed 5 consecutive months of steady growth. This country publishes GDP numbers on a monthly basis, rather than a quarterly one like many other countries.
USDCAD Parity after Weak Canadian GDP – Click to enlarge
Worries about the economy’s resilience were heard more recently, whether focusing on the real estate bubble or on the impact from the global slowdown. The central bank has been much less hawkish than normal, and with this figure, there’s a good reason.
USD/CAD already battled with parity earlier in the week, reaching 1.019. It then drifted downwards, but bounced off 0.9950 before climbing back. The pair trades at 1.0002 at the time of writing. This very round number has been a line of struggle in the past as well.
Further resistance is at 1.0033. For more on the loonie, see the Canadian dollar forecast.
