The USD/CAD currency pair sees a recovery on Monday, moving back towards 1.4000, following the path of the US Dollar.
The US ISM Manufacturing PMI dropped more quickly than anticipated to 48.2 in November.
Investors are waiting to see the US ADP Employment Change and Canada's employment data.
The USD/CAD pair stayed close to its recovery from Monday, reaching near 1.4010 during Tuesday's Asian trading session. The Loonie bounced back on Monday as the US Dollar rebounded, even though the US ISM Manufacturing Purchasing Managers' Index data for November was weak. This weak data supported the idea that the Federal Reserve might cut interest rates again this year.
At the time of this report, the US Dollar Index (DXY), which shows how strong the US dollar is compared to six major currencies, is moving slowly around 99.40. The USD Index bounced back on Monday after dropping to its lowest level of the month near 99.00.
The ISM report showed that the Manufacturing PMI dropped more than expected to 48.2. Economists had predicted the PMI to be lower than 48.6, down from 48.7 in October. This marks the ninth month in a row where the Manufacturing PMI was expected to fall below 50.0. When the PMI is below 50.0, it means economic activity is shrinking.
The CME FedWatch tool shows an 86.5% chance that the Fed will lower interest rates by 25 basis points to between 3.50% and 3.75% in December.
Moving ahead, the biggest factors that will affect the US Dollar will be the ADP Employment Change and the ISM Services PMI numbers for November, which are set for release on Wednesday.
Meanwhile, the Canadian Dollar (CAD) is likely to stay in a neutral position as investors wait for the November employment data, which will come out on Friday. The labor market numbers are expected to affect how people think the Bank of Canada might adjust its monetary policies.
Economists think the Canadian unemployment rate will go up to 7% from 6.9% in October. They also believe the number of people looking for work in Canada will stay the same.
The US ISM Manufacturing PMI dropped more quickly than anticipated to 48.2 in November.
Investors are waiting to see the US ADP Employment Change and Canada's employment data.
The USD/CAD pair stayed close to its recovery from Monday, reaching near 1.4010 during Tuesday's Asian trading session. The Loonie bounced back on Monday as the US Dollar rebounded, even though the US ISM Manufacturing Purchasing Managers' Index data for November was weak. This weak data supported the idea that the Federal Reserve might cut interest rates again this year.
At the time of this report, the US Dollar Index (DXY), which shows how strong the US dollar is compared to six major currencies, is moving slowly around 99.40. The USD Index bounced back on Monday after dropping to its lowest level of the month near 99.00.
The ISM report showed that the Manufacturing PMI dropped more than expected to 48.2. Economists had predicted the PMI to be lower than 48.6, down from 48.7 in October. This marks the ninth month in a row where the Manufacturing PMI was expected to fall below 50.0. When the PMI is below 50.0, it means economic activity is shrinking.
The CME FedWatch tool shows an 86.5% chance that the Fed will lower interest rates by 25 basis points to between 3.50% and 3.75% in December.
Moving ahead, the biggest factors that will affect the US Dollar will be the ADP Employment Change and the ISM Services PMI numbers for November, which are set for release on Wednesday.
Meanwhile, the Canadian Dollar (CAD) is likely to stay in a neutral position as investors wait for the November employment data, which will come out on Friday. The labor market numbers are expected to affect how people think the Bank of Canada might adjust its monetary policies.
Economists think the Canadian unemployment rate will go up to 7% from 6.9% in October. They also believe the number of people looking for work in Canada will stay the same.
