In the early Asian trading hours on Friday, the USD/CAD pair is seen trading weaker above the 1.3500 mark, with the US Dollar (USD) struggling below 104.00. The pair is currently at 1.3523, showing a slight decline of 0.05% for the day.
The Federal Reserve kept interest rates unchanged at its March meeting and maintained its projection for three rate cuts this year. Fed Chair Jerome Powell emphasized that a strong job market wouldn’t deter the central bank from potential rate cuts.
US economic data showed a mixed picture, with the S&P Global Manufacturing PMI rising to 52.5 in March but Services PMI easing to 51.7. The Composite PMI stood at 52.2, slightly lower than the previous reading.
On the Canadian front, the Bank of Canada (BoC) Summary of Deliberations from March indicated a possibility of rate cuts later this year if economic conditions align with projections. BoC Governor Tiff Macklem expressed caution, aiming not to rush into rate changes.
Looking ahead, Canadian retail sales data for January, expected to decline by 0.4% MoM, is due on Friday. Additionally, speeches by Fed Chair Jerome Powell and Michael Barr are scheduled.
Trade Idea:
Monitor USD/CAD for potential downside moves as USD weakness persists. Keep an eye on Canadian Retail Sales data and speeches by key figures for market direction cues.