FX Markets Outlook – CAD and AUD

A report in Canada showed that gross domestic product climbed at the fastest pace for the past two years in July. This could well be seen as a strong indication that Canada’s economy is gaining momentum after having experienced a slowdown in the second quarter. Furthermore consumer sentiment rose to the highest level in more than two years as employment keeps on increasing and the country’s housing market remained buoyant. The USD/CAD appreciated to 1.0320.
Economists forecast that the Reserve Bank of Australia will refrain from cutting interest rates today. Beyond that Chinese data showed a gauge of manufacturing increased at a slower speed than the market had forecasted. Demand for higher yielding assets was limited and the AUD was close to a two-week low versus the USD. The AUD/USD was at 0.9320 and the NZD/USD traded at 0.8299.