Ella 
In the Asian market on Friday, USD/CAD strengthened for the fifth consecutive day and was around 1.3730. USD/CAD has been provided with some support by a stronger U.S. dollar following the release of promising U.S. Purchasing Managers Index (PMI) data. Traders awaited fresh impetus from Canadian retail sales and U.S. durable goods orders. In addition, Fed Chairman Waller will speak later in the day.
U.S. private sector business activity grew faster than in April, according to S&P Global. The U.S. Composite Purchasing Managers Index (PMI) jumped to 54.4 in May from 51.3 in April, which was better than market expectations. The manufacturing purchasing managers’ index in May rose to 50.9 from 50.0 in April, which was stronger than the expected value of 50.0. The services purchasing managers’ index in May jumped to 54.8, which was better than expected and the previous value of 51.3. The U.S. Dollar Index (DXY) has risen above the 105.00 mark, boosting USD/CAD following an upbeat U.S. PMI report.
In the Canadian dollar, as Canada is the largest oil exporter to the United States, falling crude oil prices have put some selling pressure on the commodity-linked Canadian dollar (CAD). Additionally, expectations that the Bank of Canada (BoC) will cut interest rates ahead of the U.S. Federal Reserve (Fed) may weigh on CAD/USD. Money markets put a 53 per cent chance of a 25-basis-point rate cut from the Bank of Canada in June, with a July rate cut fully priced in.
