The USD/CAD pair is trading around 1.3655 on Friday, with the US Dollar weakening. The US GDP grew by 1.6% in Q1 2024, down from 3.4% in Q4 2023. Weak Canadian Retail Sales data has led to speculation that the Bank of Canada may cut interest rates in June.
The US economy saw slow growth in Q1 2024, with GDP increasing by 1.6% annually. This is below expectations and is attributed to higher prices. US Personal Consumption Expenditures Prices also rose faster than expected. This has put pressure on the US Dollar and the USD/CAD pair.
Traders are now predicting a rate cut by the US Federal Reserve in September, with only one cut expected in 2024. On the Canadian front, weak Retail Sales data has raised concerns about a potential rate cut by the Bank of Canada in June. However, rising crude oil prices have provided some support to the Canadian Dollar.
Overall, the USD/CAD pair remains on the defensive due to the weaker USD and economic data from both countries. Investors are now awaiting the release of US Personal Consumption Expenditures Price Index data to gauge further market movements.