USD/CAD falls sharply on Canada's 2.6% GDP surge vs 0.5% expected

USD/CAD has dropped significantly following Canada's surprisingly strong third-quarter GDP growth of 2.6%, far exceeding the 0.5% forecast. The Canadian dollar strengthened as the data revealed robust economic performance driven by an improved trade balance, with exports rising while imports declined. Government capital spending also contributed to increased investment, though business investment remained flat. The strong GDP figures suggest the Bank of Canada may maintain a less dovish stance than previously anticipated, supporting CAD strength. Technical indicators show USD/CAD breaking below key support levels, with momentum favoring further downside. The pair faces immediate support at recent lows, while resistance has formed at pre-data levels. Traders should monitor upcoming Canadian employment data and any Bank of Canada commentary for additional directional cues on the loonie's trajectory.