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USD/CAD bullish and looking for 1.11 lows - TDS

FXStreet (Guatemala) - Shaun Osbourne, Chief FX Strategist at TD Securities notes the surrounding circumstances for the USD/CAD.

Key Quotes:

"USD/CAD is trading with little in the domestic data front to bother markets until later in the week, the CAD will remain a slave to the flows and charts for the next few days”.

“Canada releases Q2 current account data on Thursday and GDP data on Friday."

"Bank of Canada Governor Poloz, speaking on the sidelines of the Jackson Hole event, remarked that Canada’s weak labour market was not creating the full time jobs and income that could be expected in a recovery which would allow the central bank to keep interest rates near historic lows, according to a Bloomberg report over the weekend."

"The remarks seem to reflect the recent trend evident in the domestic labour market data which reflect a growing proportion of part-time work at the expense of full-time work—and the consequences for a domestic demand-driven economy from a relative deterioration in the quality of jobs being created at home. Interestingly, as some FOMC officials are talking about the need to raise rates, Governor Poloz is stressing that the BoC—which next meets on September 3—has time to assess policy and watch how things unfold."

"We remain bullish on the outlook for USD/CAD and look for gains though the recent peaks in the upper 1.09 area to trigger a push to the low 1.11s—dovish comments from Poloz should give funds a nudge higher to retest the recent highs at least. We think the USD should remain well-supported in the low 1.09s from here."

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