Statistics Canada is set to report quarterly GDP data this Friday, which is especially important given the observed solid performance in Q2.
Investors would be eager to see whether the Canadian economy has been able to sustain robust growth in Q3, following the marked growth that was recorded in the second fiscal quarter to June 2019.
The Canadian economy had grown by 0.9 per cent in Q2, which measured a significant improvement from Q1's marginal growth of 0.1 per cent. Thus, the observed growth in Q2 was the most substantial single surge in the growth rate since Q2 of 2017.
Canada GDP Growth Rate. Image source: TradingEconomics.com
The Canadian economy has shown significant resilience to the global trade uncertainties that are currently weighing down heavily on other advanced economies.
It is currently being supported by a very strong labour market and inflation rate just below the Bank of Canada’s target level. Both of these indicators exemplify the robust outlook of Canada’s economy.
Thus, there are enough reasons to expect the growth rate to have remained performing well during the fiscal quarter ending in September.
Traders are likely to bet on the strengthening of the Canadian dollar if this Friday’s economic report proves to be as positive as the previous one.
Last time, the USDCAD pair tumbled by more than 140 pips in the week and a half following the release of the GDP growth data for Q2.
Currently, the pair is trading close to 1.33000, and the short-term momentum has already turned distinctly bearish, following its failed attempt to breakout above the major resistance at 1.33400.
The price appears to be due for establishing a corrective bearish ABC pattern, possibly by testing the strength of the minor support at 1.32070.
USDCAD 1D Price Chart. Image source: Trendsharks ©, created with TradingView.com
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