HomeContributorsFundamental AnalysisCanadian Dollar Steady, US Inflation Data Next

Canadian Dollar Steady, US Inflation Data Next

The Canadian dollar has edged higher in the Tuesday session. In the North American session, USD/CAD is trading at 1.2713, down 0.16% on the day. On the release front, there are no Canadian indicators on the schedule. Central bankers will attend an ECB event in Frankfurt, with Fed Chair Janet Yellen participating in a panel discussion. The US will release PPI reports, which are expected to show very small gains. Wednesday promises to be busy, with the US releasing CPI and retail sales reports.

US President Trump is wrapping up his tour of Asian Pacific countries, and he reiterated his message of "America first". This protectionist stance could signal trouble for Canada and Mexico, as Trump has vowed to renegotiate the NAFTA free trade agreement. On his Asian trip, Trump reiterated that he favors bilateral trade agreements rather than multilateral arrangements. Negotiators from the three countries are meeting for another round of talks on Wednesday, and by all accounts, the talks are progressing slowly. NAFTA covers more than $1 trillion a year in trade, and if the agreement is not renegotiated, the Canadian economy will be adversely affected, and the Canadian dollar would likely lose ground against the greenback.

Investors are keeping close eye on developments with President Trump’s tax proposal. There are some differences in the House and Senate bills, with some Republicans opposed to eliminating federal deductions of state and local taxes. The Republicans hope to present Trump with a new tax code by the end of the year, but with Democrats putting up fierce resistance, it’s unclear whether the bill will have enough votes to get through Congress. If the proposal is successful, the resulting economic growth could lead to higher interest rates, which would likely boost the US dollar against other currencies.

MarketPulse
MarketPulsehttps://www.marketpulse.com/
MarketPulse is a forex, commodities, and global indices research, analysis, and news site providing timely and accurate information on major economic trends, technical analysis, and worldwide events that impact different asset classes and investors. This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities.

Featured Analysis

Learn Forex Trading

Your Trading Plan Is Essential

How to Trade Using Oscillators

Best Forex Scalping Method

Risk and Reward