The Canadian economy shrank by 0.2% in December, exactly as expected. This isn’t good news, but a one-month contraction isn’t extraordinary in Canada.
USD/CAD climbed towards the release and manged to reach 1.0342. The pair reacted with a drop immediately afterwards, falling as low as 1.0306.
The pair has support at 1.03, followed by 1.0250. Resistance is at 1.0360, followed by 1.0420. For more levels, see the USD CAD forecast.
Canada is unique in releasing GDP figures once per month. The annualized growth rate in Q4 stands on 0.6%, also as expected. An upside revision was made for Q3, from +0.6% to +0.7%.
Update: 1.03 certainly works as strong support. It looks like CAD/USD parity is far off for now.
