• USD/CAD strengthens as the US Dollar appreciates due to optimism surrounding the Trump trades.
• The implementation of US President-elect Donald Trump’s proposed fiscal policies could delay further rate cuts by the Fed.
• The commodity-linked CAD weakens as Oil prices decline following OPEC's lowered forecast for global Oil demand growth in 2024.

USD/CAD moves upwards for the fourth successive session, trading around 1.3960 during the early European hours on Wednesday. The primary factor contributing to the recent weakness in EUR/USD is the strength of the US Dollar (USD) amid optimism surrounding the Trump trades.

The implementation of US President-elect Donald Trump’s proposed fiscal policies could stimulate investment, increase government spending, and bolster labor demand. However, this surge in economic activity could also fuel inflation risks.

On Tuesday, Minneapolis Fed President Neel Kashkari affirmed that the central bank remains confident in its ongoing battle against transitory inflation but cautioned that it is still too early to declare full victory. Kashkari also noted that the Fed would refrain from modeling the economic impact of Trump’s policies until there is greater clarity on the specifics of those policies.