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Canadian GDP misses forecasts- USD/CAD yet to rebound

The Canadian GDP data has also just been released and it has missed on forecasts. GDP rose by 1.7% annualised in Q1, where a rise of 2.2% was forecast. This has now caused the markets to price in around an 80% chance of a BOC rate cut next week (June 5). The USD/CAD has not really lifted much on the news and initially it did slip, which is perhaps a little surprising, but we have to put that in the context of a wider dollar that has fallen back further following the release of the US PCE data. The support at 1.3615 remains the noted next downside level and all the while that holds, the risks of deeper decline may be put on hold. That would kind of make sense with the likely prospect of a Canadian rate cut next week. The likes of the CAD/JPY and EUR/CAD might be a better way to reflect relative CAD weakness right now, following this GDP miss. The USD/CAD is currently trading at 1.3642

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