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Canadian GDP Remained Flat in July; USD/CAD Rallies

Today, Statistics Canada released GDP data for July, and it was flat after 6 straight months of gains. June's reading was 0.3%, and the forecast for July averaged 0.2%. 


(source: StatCan)

Growth in Manufacturing and the Public Sector was clouded by contraction in agriculture and forestry, mining and oil and gas extraction, utilities, wholesale, transportation and warehousing, as well as arts and entertainment. 


(source: StatCan)

USD/CAD was already bullish ahead of the CAN GDP data, but did consolidate this week. Even ahead of the release price cracked the 1.1180 high on the week, but came back down to about 1.1160 and the 50-hour SMA. Then after the soft data, traders pushed USD/CAD clearly above the 1.1180 resistance. Now, if price can hold above 1.1160, the bullish outlook should remain in play.

(USD/CAD 1H Chart 9/30)

If the breakout can confirm and extend, the next resistance would be the 1.1278 high on the year.