Canada's economy may expand rapidly by the end of this year.

The Canadian dollar has weakened rapidly, under pressure from the strengthening US dollar amid increasing demand for safer assets. In its latest meeting, the Bank of Canada (BoC) decided to keep interest rates unchanged. Additionally, the forecast for economic growth has been revised upward to 1.5% from 0.8%, leading analysts to anticipate the BoC's first rate cut in June.

The Bank of Canada has kept the interest rate at 5% as expected, without further comment on starting rate cuts due to persistent high inflationary pressures. Although price pressures have eased in various goods and services, uncertainties in the global economy and higher consumer goods prices due to ongoing conflicts have prevented the BoC from setting a definite date for rate cuts.

Tiff Macklem, Governor of the Bank of Canada, added that recent inflation rate data indicated progress in keeping underlying inflationary pressures from increasing. This is a crucial indicator for monetary policy adjustments. However, underlying inflation rates have not fallen within the framework set by the BoC. Consequently, the BoC expects the inflation rate to remain close to 3% in the first half of this year before reaching the target of 2% in 2025. Domestic production is expected to strengthen in line with the global economic recovery, with GDP projected to expand by 1.5% this year and 2.2% in 2025.

The unemployment rate in Canada rose to 6.1% in March from 5.8% in the previous month, significantly higher than market expectations. The number of unemployed people increased by 60,000 to 1.26 million, with 65% of the unemployed having been job seekers for more than a month. This increase in the unemployment rate aligns with the Bank of Canada's prediction that higher interest rates will significantly impact Canada's labor market, putting pressure on the BoC to consider rate cuts.

Canada's trade surplus exceeded CAD 1.4 billion in February, higher than market expectations of CAD 0.8 billion, driven by rapid export growth of 5.8% to CAD 66.6 billion. The increase in exports was mainly in metallic minerals and metal ores, including gold, silver, and platinum. Meanwhile, imports grew at a slower pace of 4.6% to CAD 65.2 billion, primarily due to increased purchases of electronic equipment and components.

Techical analysis data (5H)

Resistance: 1.376, 1.3773, 1.3782

Source: Investing.com

Buy/Long 1: If the price touches support in the price range of 1.3729 - 1.3738 but cannot break the support at 1.3738, you may set a TP at approximately 1.3773 and SL at around 1.3716 or according to your acceptable risk.

Buy/Long 2: If the price breaks the resistance in the price range of 1.376 - 1.3773, you may set a TP at approximately 1.3782 and SL at around 1.3729 or according to your acceptable risk.

Sell/Short 1: If the price touches resistance in the price range of 1.376 - 1.3773 but cannot break the resistance at 1.376, you may set a TP at approximately 1.3729 and SL at around 1.3782 or according to your acceptable risk.

Sell/Short 2: If the price breaks the support in the price range of 1.3729 - 1.3738, you may set a TP at approximately 1.3716 and SL at around 1.3773 or according to your acceptable risk.

Pivot point April 15, 2024 06:54 PM. GMT+7