• USD/CAD declines further to 1.3670 ahead of BoC’s Macklem speech.
• Canadian annual headline CPI is estimated to have declined to 2.6%.
• Fed policymakers want to see inflation declining for months before shifting to rate cuts.

The USD/CAD pair extends its losing streak for the seventh trading session on Monday. The Loonie asset weakens as the US Dollar Index (DXY) corrects to near 105.66 after failing to extend upside above the crucial resistance of 106.00. The US Dollar (USD) drops as investors shift to risk-perceived assets amid expectations that the Federal Reserve (Fed) will deliver two rate cuts this year.

S&P 500 futures have posted decent gains in the European session, exhibiting a higher risk appetite of investors. 10-year US Treasury yields edge down to 4.25%.

Contrary to market expectations, Fed policymakers signalled in latest interest rate projections that there will be only one rate-cut this year. The Fed continues to reiterate the same despite May’s Consumer Price Index (CPI) report showed that price pressured eased more than expected.

Richmond Fed Bank President Thomas Barkin said on Friday that he wants more conviction before moving on rate cuts. Fed officials would get more conviction after seeing inflation declining for months