The USD/CAD pair has surged close to 1.4000, driven by a robust U.S. dollar. This rise reflects optimism about U.S. economic momentum, further supported by inflation expectations. Investors are now closely watching the upcoming U.S. Producer Price Index (PPI) data, which could provide insights into inflation trends and potential impacts on monetary policy. A higher PPI reading could reinforce the dollar’s strength, intensifying pressure on the Canadian dollar.
This currency movement underscores the growing economic divergence between the U.S. and Canada, with the U.S. projected for stronger growth. Traders may anticipate continued volatility as inflation data and policy expectations evolve.
