Canadian Dollar: Remains slightly softer against US Dollar – Scotiabank
Scotiabank strategists Shaun Osborne and Eric Theoret highlight that the Canadian Dollar (CAD) is effectively unchanged versus the US Dollar (USD) but outperforming peers, supported by firmer Oil and steady US-Canada front-end spreads.
The Canadian Dollar remained relatively unchanged against the US Dollar, but outperformed its peers on Tuesday, according to Scotiabank strategists Shaun Osborne and Eric Theoret. The support for the Canadian Dollar came from stronger oil prices and steady front-end US-Canada yield spreads. However, the Canadian Dollar may face challenges in resisting the broader trend of the US Dollar, especially around the Federal Open Market Committee (FOMC) meeting.
Despite the Canadian CPI data showing mixed results, underlying core measures continue to highlight price risks and the potential for the Bank of Canada to start normalizing its monetary policy later this year. The Canadian Dollar is expected to struggle to surpass the resistance zone between the low/mid 1.39s, which is defined by various moving averages and retracement levels. Initial support for the US Dollar is noted at 1.3825/30 and 1.3730/60.
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