USD/CAD deflates to lows near 1.3450, FOMC eyed

The greenback is losing the grip vs. its G10 peers ahead of the opening bell in Europe on Wednesday, now dragging USD/CAD to fresh lows in the mid-1.3400s.

USD/CAD attention to US data, FOMC

Choppy start of the week for the pair, which is now looking to stabilize above the 1.3400 handle after last week’s 3-month tops in the 1.3530 area.

Policy divergence between the Fed and the Bank of Canada stays as the exclusive driver behind the pair’s price action as of late, relegating crude oil dynamics to a secondary role.

On the data front, US inflation figures and Retail Sales should grab all the attention in the first turn seconded by the Empire State index, Business Inventories, the NAHB index and the EIA’s report on crude stockpiles.

Looking ahead, the FOMC is expected to hike rates by 25 bp today taking the Fed Funds to a 0.75%-1.00% target, although the subsequent press conference by Chief J.Yellen and the revised ‘dots plot’ carry the potential to be the market movers later in the NA session.

USD/CAD significant levels

As of writing the pair is losing 0.15% at 1.3460 and a break below 1.3419 (low Mar.10) would aim for 1.3395 (low Mar.8) and then 1.3369 (low Mar.6). On the other hand, the initial up barrier is located at 1.3496 (high Mar.14) followed by 1.3536 (2017 high Mar.9) and finally 1.3601 (high Dec.28 2016).