Canadian Dollar: Rangebound near fair value against US Dollar – Scotiabank
Scotiabank strategists Shaun Osborne and Eric Theoret observe that the Canadian Dollar (CAD) is little changed, with USD/CAD trading around their fundamental equilibrium estimate near 1.3920.
Scotiabank analysts Shaun Osborne and Eric Theoret report that the Canadian Dollar (CAD) remains stable, trading near a fundamental equilibrium of 1.3920 against the US Dollar (USD). Despite Federal Reserve (Fed) expectations and trade uncertainty, the Canadian Dollar demonstrates resilience. However, their analysis indicates that gains are limited by the wide interest rate gap.
This week's Canadian economic calendar includes a Bank of Canada (BoC) decision on Wednesday and a moderate gain in employment from the jobs report on Friday. The Canadian Dollar currently trades below the estimated fair value, but the Canadian Dollar continues to outperform against this benchmark. Neutral technical indicators suggest that the USD may experience a minor correction in the short run, with potential gains reaching the mid-upper 1.39s, but resistance at 1.3980/00 is expected. Support levels are identified at 1.3845 and 1.3820/25.
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