The USD/CAD price analysis turned bullish as data from Canada and the US underscored the widening gap in policy outlooks between the Fed and the BoC. Meanwhile, investors are awaiting the FOMC policy meeting. On Tuesday, data from Canada revealed a smaller-than-expected 0.2% expansion in the economy in February. Moreover, estimates for Q1 growth came in lower than the Bank of Canada’s forecasts. This indicates a deteriorating economy as businesses feel the impact of higher interest rates. Consequently, there is more reason for the BoC to start cutting interest rates in June. A further delay in the rate-cut cycle could cause more damage to an already weak economy. Investors are currently placing a 60% chance that the central bank will start cutting rates in June. Additionally, they expect a total of 54bps of rate cuts in 2024.Meanwhile, the US economy remains resilient despite high rates. Data on Tuesday revealed hotter-than-expected employment cost growth in the country. This was another sign of strength in the labor market that will keep the Fed cautious about rate cuts. While investors expect 54bps of cuts in Canada, they only expect 32bps in the US. Moreover, this figure might change after the FOMC policy meeting.When the Fed decides on a policy, they will likely maintain higher interest rates. Additionally, they might be more hawkish than they have been before, given the recent upbeat economic data. The Fed will maintain high rates as long as inflation remains above target. USD/CAD key events today

 USD/CAD technical price analysis: Price makes strong reversal after bullish RSI divergence USD/CAD 4-hour chartOn the technical side, the USD/CAD price has made a sharp bullish reversal by breaking above the 30-SMA resistance. This comes after the RSI showed weakness in the previous bearish trend with a bullish divergence. Currently, the RSI sits in the overbought region, supporting solid bullish momentum. However, after such a sharp move where the price has only made bullish candles, bears might emerge for a short pause before the uptrend continues. The next target for this uptrend is at 1.3840. More By This Author:GBP/USD Price Analysis: Buyers Dominate Ahead Of FOMCUSD/JPY Forecast: Yen Surges on Intervention FearsUSD/CAD Weekly Forecast: Slowing US Economy Dents Dollar