Photo by Michelle Spollen on Unsplash

The Canadian Dollar is trading lower against its US peer on Thursday. The US Dollar has shrugged off investors’ hopes of Fed easing and Treasury Secretary Bessent’s pressure on the US Central bank and is featuring a moderate recovery ahead of the US PPI data release.

The USD/CAD pair has bounced up from lows at 1.3745 to reach session highs right above 1.37800 on Thursday’s European morning session. The pair, however, remains trapped within the tight weekly range, with 1.38000 limiting upside attempts

US PPI data might provide some support to the USDollar later today

Moderate US inflation data seen earlier this week boosted hopes of Fed cuts and sent the USDollar lower across the board, but investors are trimming USD short bets on Thursday, bracing for hotter producer prices data.

US PPI is expected to have accelerated at a 0.2% pace in July, following a flat reading in June, and to 2.5% on the year, from 2.3% in June. Likewise, the core PPI is seen picking up to 0.2% from 0% on the month and to 2.9% year-on-year, after a 2.6% reading in June. These figures might cool hopes of immediate monetary policy easing.

In Canada, in the absence of key macroeconomic data, the lower oil prices –WTI Oil is trading at 2-month lows near $62.00– keep the Canadian Dollar on its back foot. Hopes of a peace deal in Ukraine and the OPEC+ decision to hike output further in September are acting as headwinds for Oil price recovery.

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