USDCAD: Continue to look for test near 1.33 - BBH

Research Team at BBH, suggests that the US dollar has built a based near CAD1.30 for six sessions and it took the extremely poor Canadian data (and strong US data) to lift it from its base to CAD1.32.  

Key Quotes

“The economy lost jobs for the second consecutive month in July.  Canada also reported its second consecutive record trade deficit June). This follows, as you will recall, a 0.6% contraction in the Canadian economy in the month of May.  It is the third decline in output in four months.    

We continue to look for test near CAD1.33. Over the slightly longer term, the risk increases that Bank of Canada will be more dovish, and the US dollar moves toward CAD1.36.”