USD/CAD Falls Toward 1.3600 Ahead Of FOMC Minutes -

USD/CAD Falls Toward 1.3600 Ahead Of FOMC Minutes

Aug 20, 2024Jeremy ParkinsonFinance0

USD/CAD extends its losses despite a market caution ahead of the FOMC Meeting Minutes release on Wednesday.

Fed Governor Michelle Bowman expressed caution on any policy changes, citing ongoing upside risks to inflation.

The Canadian dollar appreciates despite a dovish sentiment surrounding the Bank of Canada.

USD/CAD continues its losing streak, trading around 1.3620 during the Asian session on Wednesday. The US Dollar (USD) attempts to halt its three-day losing streak as traders turn cautious ahead of the release of the FOMC Minutes on Wednesday. Furthermore, traders await Fed Chair Jerome Powell’s upcoming speech at Jackson Hole on Friday.Federal Reserve (Fed) Governor Michelle Bowman expressed caution on Tuesday about making any policy changes, citing ongoing upside risks to inflation. Bowman warned that overreacting to individual data points could undermine the progress already achieved, according to Reuters.CME FedWatch Tool suggests that the markets are now pricing in a nearly 67.5% odds of a 25 basis points (bps) Fed rate cut in its September meeting, down from 76% a day ago. The probability of a 50 basis points rate cut fell to 32.5% from 53.0% a week earlier.The Canadian dollar strengthened despite soft domestic data that supports a dovish stance from the Bank of Canada (BoC). Furthermore, the commodity-linked CAD managed to hold its ground, even as crude Oil prices declined.Canada’s Consumer Price Index (CPI) eased to 2.5% year-on-year in July, down from 2.7% in the previous month, aligning with market expectations. This marks the slowest increase in consumer prices since March 2021. Additionally, the closely watched BoC Consumer Price Index Core fell to 1.7% YoY, from the previous 1.9% reading, reinforcing dovish expectations for the Bank of Canada.West Texas Intermediate (WTI) Oil price extends its losing streak for the fourth successive session, trading around $72.90 per barrel at the time of writing, amid hopes for a ceasefire in the Middle East. US Secretary of State Antony Blinken confirmed that Israeli Prime Minister Benjamin Netanyahu accepted a proposal to resolve the issues delaying a Gaza ceasefire. However, tensions remain high as Hamas has threatened to resume suicide bombings, according to Reuters.More By This Author:EUR/CAD Depreciates To Near 1.5100 After EEMU HICP Data, Canada’s Inflation Eyed AUD/USD Price Forecast: Maintains Position Near 0.6750 With A Short-term Bullish Trend Silver Price Forecast: XAG/USD Pulls Back From $29.50 After Easing Of Middle-East Tensions