• USD/CAD gains ground to around 1.3795 in Friday’s early Asian session. 
• The US Retail Sales rose by 0.4% MoM in September vs. 0.1% prior, stronger than expected. 
• The rising expectation of a BoC rate cut could undermine the CAD, but higher crude oil prices might cap its downside. 

The USD/CAD pair trades with mild gains around 1.3795 during the early Asian session on Friday. The further upside in the Greenback amid the stronger US economic data provides some support to the pair. Later on Friday, the US Building Permits and Housing Starts will be released. Also, the US Federal Reserve’s (Fed) Raphael Bostic, Neel Kashkari and Christopher Waller. 

The US Retail Sales surprised to the upside in September, boosting the US Dollar (USD) broadly. Data released by the US Census Bureau on Thursday revealed that retail sales in the US rose by 0.4% MoM in September from a 0.1% rise in August. This figure came in stronger than the expectations of a 0.3% monthly gain. Meanwhile, Retail sales excluding autos came in at 0.5% MoM in September versus 0.2% prior, above the market consensus of 0.1%. 

Signs of the economy's resilience will trigger expectations for a smaller 25 basis points (bps) rate cut in November. According to the CME FedWatch tool, the markets have priced in a nearly 90.3% chance of a 25 bps Fed rate reduction in November. Goldman Sachs analysts said they expect the Fed to deliver consecutive 25 bps rate cuts from November 2024 through June 2025 to a terminal rate range of 3.25-3.50%.