When is the monthly Canadian GDP report and how could it affect USD/CAD?

Canadian monthly GDP overview

Friday's economic docket highlights the release of monthly Canadian GDP growth figures for August, scheduled to be published at 12:30 GMT by Statistics Canada. Following the previous month's strong growth of 3%, the report is expected to show that the Canadian economy expanded at a slightly moderate pace, by 0.9% during the reported month.

How could it affect USD/CAD?

Concerns about the potential economic fallout from new COVID-19 restrictions has benefitted the safe-haven USD. Meanwhile, worries that renewed lockdown measures could hurt fuel demand dragged crude oil prices to multi-month lows. The combination of factors pushed the USD/CAD pair to one-month tops on Thursday.

However, uncertainty about the outcome of the US presidential election prompted the USD bulls to lighten their bets and kept a lid on any further gains for the major. Ahead of the important release, the USD/CAD pair continued with its two-way price swings and held comfortably above the 1.3300 round-figure mark.

Given that the recent price action has been exclusively sponsored by developments surrounding the coronavirus saga, the backwards-looking data is unlikely to provide any meaningful impetus. That said, any significant divergence from the expected figures might still produce some short-term trading opportunities.

Meanwhile, immediate resistance is pegged near daily tops, around the 1.3345 region, ahead of the overnight swing high, just ahead of the 1.3400 round-figure mark. This is closely followed by the 1.3415-20 heavy supply zone, which if cleared decisively will set the stage for additional near-term gains.

On the flip side, dips below the 1.3300 level might now be seen as a buying opportunity. However, some follow-through weakness below the overnight swing lows, around the 1.3280-75 region, might prompt some technical selling and accelerate the slide further towards the 1.3225-20 horizontal support.

Key Notes

   •   USD/CAD Price Analysis: 100-day SMA guards immediate upside

   •   USD/CAD analysis: Buying signals

   •   USD/CAD: A buying opportunity at 1.3270/60

About monthly Canadian GDP

The Gross Domestic Product released by Statistics Canada is a measure of the total value of all goods and services produced by Canada. The GDP is considered a broad measure of Canadian economic activity and health. Generally speaking, a rising trend has a positive effect on the CAD, while a falling trend is seen as negative (or bearish) for the CAD.