The USD/CAD pair exhibited upward momentum, trading near 1.3880 during Thursday’s Asian session. This movement occurred amidst remarks from Federal Reserve Chair Jerome Powell, who indicated a deceleration in US economic growth. The Bank of Canada (BoC) maintained its policy rate at 2.75% at its April meeting, ending a sequence of seven consecutive rate increases. Gains for the USD/CAD pair may be constrained by ongoing trade uncertainties. Market participants are closely monitoring developments in US trade negotiations. Powell cautioned that trade tensions pose a risk to the Fed’s employment and inflation objectives. He also noted modest growth in consumer spending and the potential for tariff-related import surges to negatively impact GDP estimates. Financial markets anticipate the US Federal Reserve will resume rate cuts in June, projecting a full percentage point reduction in the policy rate by year-end. US Retail Sales for March exceeded expectations, rising by 1.4%, according to the US Census Bureau. Despite this positive data, the US dollar’s gains were limited as markets await progress on US trade agreements.
