Usdcad remains stable at 1.36710 as market anticipates economic data impacts

USDCAD Analysis

Performance after Wednesday
Period	Pct	Chg	Momentum
Wednesday	0%	0.6 Pips
Week to-date	-0.17%	-23 Pips
June	-0.55%	-75 Pips

Upcoming key events (London Time)

Thu 01:30 PM USD PPI excluding Food and Energy sectors (12-mth)
Fri 03:00 PM USD Index of Consumer Sentiment

What happened lately

In May 2025, the United States saw significant changes in its economic indicators. The Monthly Treasury Budget Statement notably declined to -316 billion dollars from 258 billion dollars in April. Such a substantial negative shift might indicate heightened federal spending or reduced revenue intake, reflecting potential economic challenges or increased fiscal stimulus measures. Concurrently, inflation showed slight movement; the overall Consumer Price Index (CPI) inflation rate increased marginally to 2.4% in May from 2.3% the previous month. However, when excluding the often-volatile food and energy sectors, core CPI inflation remained stable at 2.8%, identical to April’s numbers. Meanwhile, month-over-month core CPI saw a minor decline to 0.1% from 0.2%. The marginal monthly inflation rate also decreased from 0.2% to 0.1%, suggesting a slower price growth rate.

These developments in the United States’ fiscal landscape and inflation indicators are pivotal for currency valuations, especially concerning the USDCAD pair. A sharp drop in the Treasury Budget Statement could be perceived negatively by investors, indicating potential economic distress or inefficiencies in fiscal management, which may lead to a weaker U.S. dollar. Conversely, the stable core inflation rate may reflect underlying economic robustness, as it indicates controlled inflation excluding volatile sectors. However, the overall inflation rise might prompt the Federal Reserve to consider policy adjustments, potentially boosting the dollar if interest rates are increased in response.

Considering the USDCAD remained unchanged at 1.36710, the currency pair is in a consolidation phase, possibly due to market anticipation of further economic insights. Upcoming high-impact events, such as the U.S. Producer Price Index (PPI) for 12 months excluding food and energy sectors and the Index of Consumer Sentiment, could significantly affect traders’ expectations and drive volatility in the currency markets. Should these indicators suggest strong economic momentum, the U.S. dollar may appreciate, leading to a potential decrease in USDCAD. Conversely, if these indicators are disappointing, the Canadian dollar could strengthen against a weaker U.S. dollar, potentially leading to an increase in the USDCAD rate.

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What can we expect from USDCAD today?

USDCAD on Wednesday dropped 0% to 1.36710. Price is below 9-Day EMA while Stochastic is falling.

Updated daily direction for USDCAD looks mixed as the pair is likely to consolidate above 1.36473 (S1).

Looking ahead today, to see upside interest, we prefer to look at price breakout of last daily high of 1.36901 or trades above daily pivot 1.36687. Break above could target R1 at 1.36924. While to the downside, we are looking at 1.36473 (S1) and daily low of 1.36450 as support levels. USDCAD need to break on either side to indicate a short-term bias. A close below 1.36450 would indicate selling pressure.

For the week to-date, take note that USDCAD is mixed as compared to the prior week.

Key levels to watch out:

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