The Canadian dollar (CAD) is exhibiting range-bound trading behavior against its US counterpart as market participants brace for the release of key Canadian GDP data. Investors are keenly awaiting the economic figures, anticipating insights into the strength of the Canadian economy.

The upcoming GDP data is expected to provide clues regarding the trajectory of the Canadian economy and may influence the Bank of Canada’s (BoC) future monetary policy decisions. A stronger-than-expected GDP reading could bolster the case for further interest rate hikes, while a weaker-than-anticipated figure might prompt the BoC to maintain or even lower interest rates.

Market analysts suggest that the CAD’s movement will largely depend on the GDP data’s deviation from expectations. Traders are positioning themselves cautiously, leading to the current range-bound trading pattern. The currency’s performance in the short term will likely be dictated by the market’s interpretation of the economic data and its potential impact on the BoC’s policy outlook.