USD/CAD oscillates above 1.3550 ahead of US GDP/ Durable Goods data, oil soars

• USD/CAD is juggling above 1.3550 as the focus has shifted to the US growth rate and Durable Goods data.
• The BOC surprised the market with a lower-than-projected rate hike by 50 bps.
• Oil prices have accelerates despite a build-up of oil inventories by the EIA.

The USD/CAD pair has turned sideways after a wild gyration in a 1.3533-1.3650 range in the late Tokyo session. The asset is displaying a rangebound structure in a 1.3545-1.3582 area in Asia. The major is expected to remain lackluster ahead of the release of the US critical data.

Meanwhile, market sentiment is extremely positive and risk-perceived currencies are having a ball. The US dollar index (DXY) has witnessed a dead cat bounce after refreshing its monthly low at 109.56. While the 10-year US Treasury yields are still vulnerable and hovering around the cushion of 4%.

A roller-coaster move in a 1.3545-1.3582 area on Wednesday was recorded after the announcement of the interest rate decision by the Bank of Canada (BOC). BOC Governor Tiff Macklem announced a rate hike by 50 basis points (bps), pushing the borrowing rates to 3.75%. A lower-than-projected rate hike has surprised the market participants.

Talking about the peak of inflationary pressures, BOC’s Macklem cited that the central bank is still far from the goal of ensuring inflation is low, stable, and predictable. On policy guidance, Canada’s central bank stated that they are getting closer to the end of the tightening phase but added that they are not there yet.

"Analysts at CIBC still expected the rate to peak at 4.25%, despite the “slight dabbing of the brakes” compared to previous hikes.

On the US dollar front, projections claim that the US GDP has witnessed a growth rate of 2.4% in the third quarter vs. a de-growth of 0.6%. Also, the US Durable Goods Orders are seen higher at 0.6% against a drop of 0.2%.

Meanwhile, oil prices have witnessed a firmer rally amid tailwinds of a weaker DXY and sanctions on Russia. The oil prices have climbed to near $88.00 despite an announcement of an oil inventory build-up by the Energy Information Administration (EIA). The oil stockpiles have accelerates by 2.588M barrels against the projections of 1.029M barrels of build-up, for the last week ending October 21.