USD/CAD struggles to pull away from multi-month lows, trades near 1.3130 ahead of US data
- Crude oil turns south despite OPEC+ intention to extend output cuts.
- US Dollar Index stays in range near 96.20 mark.
- Real GDP in the U.S. is expected to expand by 3.1% in the first quarter.
The USD/CAD pair fell to its lowest level since early February 1.3105 on Wednesday and closed the fourth straight trading day in the negative territory as rising crude oil prices helped the commodity-related loonie gather strength against the greenback. With investors staying on the sidelines ahead of today's key data releases, the pair is moving sideways in a tight range near yesterday's closing level of 1.3130.
Hopes of the U.S. and China bringing an end to the trade conflict and a huge draw in the U.S. crude oil stockpiles boosted crude oil prices with the barrel of West Texas Intermediate rising to its highest level of June near the critical $60 mark. However, although oil ministers of both Iraq and Kuwait today voiced their support for an extension to the OPEC+ output cut deal at least until the end of the year, crude oil struggled to extend its rally. Latest headlines hinting that trade talks are unlikely to be as positive as portrayed at the G20 summit seems to be weighing on commodities. At the moment, the barrel of WTI is down 0.8% on the day at $58.70.
Meanwhile, as investors are waiting for the U.S. Bureau of Economic Analysis to publish its final estimate of the first quarter GDP growth, which is expected to come in at 3.1% on a yearly basis, the US Dollar Index is staying calm near the 96.20 mark. Although it's unlikely that we see a large deviation from the expectation, any reading that impacts the rate cut odds could also impact the greenback's market valuation.
Technical levels to watch for