Investor confidence in the Canadian economy has improved due to stronger than expected Chinese PMI data for May. However, the Canadian dollar is facing pressure as significant U.S. economic data is set to be announced.

The yield on the 10-year U.S. Treasury bond has fallen to 4.48% amid market speculation that the Federal Reserve (Fed) will begin to lower interest rates at the September meeting. This speculation is driven by slower growth in U.S. personal spending data.

Investors remain focused on the U.S. Manufacturing and Services PMI data and the May Nonfarm Payrolls (NFP) report. The Composite PMI is expected to improve to 49.8 from the previous reading of 49.2