The USD/CAD pair rose on Monday as pessimism spread through markets after the ISM manufacturing was released from the United States for July, as the ISM manufacturing slowed to 50.9 well below expectations, which spread concerns among traders over the outlook for growth in the United States, as well as the outlook for growth in Canada, since the United States is Canada’s largest trading partner, and that put huge downside pressures on the CAD, and pushed the USD/CAD pair accordingly to the upside.
The focus in markets will now turn to the outlook for growth, since U.S. lawmakers were able to reach an agreement to raise the debt ceiling, nonetheless, signs that economic growth is slowing in both the United States and Canada should provide the USD with more momentum to rise against the CAD, which means that the USD/CAD pair will probably extend its rise over the coming period.
Tuesday August 02:
The United States will release the income report for the month of June at 12:30 GMT, where personal income is expected to rise by 0.2%, compared with 0.3% in May, while personal spending is expected to rise by 0.2%, compared with the prior flat estimate. Core PCE is expected to rise by 0.2% in June, compared with 0.3% back in May, while compared with a year earlier, Core PCE is expected to rise by 1.4%, compared with 1.2% in the prior estimate.