USD/CAD trades close to weekly low around 1.4030 as Fed rate cut bets remain firm

US Dollar Price This week

The table below shows the percentage change of US Dollar (USD) against listed major currencies this week. US Dollar was the weakest against the New Zealand Dollar.

	USD	EUR	GBP	JPY	CAD	AUD	NZD	CHF
USD		-0.82%	-1.18%	-0.33%	-0.46%	-1.09%	-1.82%	-0.69%
EUR	0.82%		-0.37%	0.49%	0.36%	-0.28%	-1.00%	0.13%
GBP	1.18%	0.37%		0.85%	0.73%	0.09%	-0.64%	0.50%
JPY	0.33%	-0.49%	-0.85%		-0.14%	-0.81%	-1.61%	-0.35%
CAD	0.46%	-0.36%	-0.73%	0.14%		-0.62%	-1.34%	-0.23%
AUD	1.09%	0.28%	-0.09%	0.81%	0.62%		-0.72%	0.43%
NZD	1.82%	1.00%	0.64%	1.61%	1.34%	0.72%		1.15%
CHF	0.69%	-0.13%	-0.50%	0.35%	0.23%	-0.43%	-1.15%

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).

The CME FedWatch tool shows that the probability of the Fed to cut interest rates in the December policy meeting has increased to 84.7% from 30.1% seen a week ago.

Traders have become increasingly confident about the Fed reducing interest rates in the December policy meeting, following dovish comments from New York Fed Bank President John Williams, who is the permanent Federal Open Market Committee (FOMC) voting member.

Last week, Fed’s Williams supported the need of further interest rate adjustment for the year, citing downside labour market risks.

In Thursday’s session, the action in the US Dollar is expected to remain light as United States (US) markets will be closed on account of Thanksgiving Day.

Going forward, investors will focus on the US ISM Manufacturing Purchasing Managers’ Index (PMI) data for November, which will be released on Monday.

Meanwhile, the Canadian Dollar (CAD) trades broadly calm ahead of the Q3 Gross Domestic Product (GDP) data, which is scheduled for Friday. Statistics Canada is expected to show that the economy expanded by 0.5% on an annualized basis after declining 1.6% in the previous quarter.

Economic Indicator

Gross Domestic Product (QoQ)

The Gross Domestic Product (GDP), released by Statistics Canada on a monthly and quarterly basis, is a measure of the total value of all goods and services produced in Canada during a given period. The GDP is considered as the main measure of Canada’s economic activity. The QoQ reading compares economic activity in the reference quarter to the previous quarter. Generally, a high reading is seen as bullish for the Canadian Dollar (CAD), while a low reading is seen as bearish.