U.S. Dollar Retreats As Consumer Sentiment Declines

The USD/CAD pair is currently trying to hold below the support at 1.2550 while the U.S. dollar is losing some strength because of inflation and the retreat of customer sentiment.

The U.S Dollar Index is stuck in the range between the support at 95 and the resistance at 95.20. In case the U.S. Dollar Index declines below the support at 95, it will move towards the next support level at 94.75 which will be bearish for USD/CAD.

Foreign exchange market traders had a chance to take a look at Michigan’s report on Consumer Sentiment. The report indicated that Consumer Sentiment declined from 71.7 in October to 66.8 in November while analysts expected that it would grow to 72.4.

The U.S. dollar found itself under some pressure against major currencies after this report. The report shows that high prices have become a problem for consumers.

In case inflation remains at high levels while Consumer Sentiment stays under pressure in the coming months, the Fed may have to raise rates sooner than expected.