USD/CAD trades in negative territory near 1.3855 in Thursday’s early Asian session.
Worries about a ballooning US deficit weigh on the US Dollar.
The advanced S&P Global Manufacturing and Services PMI reports will be closely watched later on Thursday.
The USD/CAD pair extends its downside to around 1.3855 during the early Asian session on Thursday, pressured by a weaker US Dollar (USD). Investors await the advanced S&P Global Manufacturing and Services PMI reports later on Thursday, followed by the Chicago Fed National Activity Index, the usual Initial Jobless Claims and Existing Home Sales.
The 'Sell America' investment theme continues to undermine the Greenback and drag the pair to the two-week low. The White House put pressure on Republicans on Wednesday, urging lawmakers to quickly approve President Donald Trump’s signature tax bill, adding that a failure to do so would be the “ultimate betrayal.”
"The disappointing auction results ... fit the narrative of weakening demand for U.S. assets and a 'sell America' trade amid fiscal concerns," said Kim Rupert, managing director, global fixed income analysis at Action Economics in San Francisco.
On the other hand, a decline in Crude Oil prices could undermine the commodity-linked Loonie and create a tailwind for the pair. It’s worth noting that Canada is the largest oil exporter to the US, and lower crude oil prices tend to have a negative impact on the CAD value.
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