Canadian Dollar: Remains slightly softer against US Dollar – Scotiabank

FXStreet Insights Team FXStreet

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. They see USD/CAD short-term tone as bullish, yet stress a significant resistance band in the low/mid-1.39s. Persistent core Consumer Price Index (CPI) pressures keep focus on Bank of Canada (BoC) normalization later this year.

Resistance zone caps upside

"The CAD is effectively unchanged against the USD on the session and a relative outperformer amongst its major currency peers as a result."

"Firmer crude oil prices are providing a little cover for the CAD, as are steady front-end US-Canada yield spreads. But the CAD will struggle to resist the broader trend in the USD into and around the FOMC decision regardless."

"Broadly in line with expectations Canadian CPI data yesterday did little for the CAD or for short-term rates but toasty underlying trends in core measures maintain the focus on price risks and the potential for the BoC to start normalizing still accommodative monetary policy later this year."

"Bullish—USD gains through the mid/upper-1.38s point to short-term USD strength extending a little more."

"We continue to note a significant resistance zone between the low/mid 1.39s, however, defined by trend resistance, the 40-and 100-day moving averages, retracement resistance, and the early September high. Initial USD support is 1.3825/30 and 1.3730/60."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

AUD/USD edges higher as hot CPI inflation and hawkish RBA lift rate hike bets

The AUD/USD pair gathers strength to near 0.7035 during the Asian trading hours on Friday. The Australian Dollar edges higher against the US Dollar as hotter Australian CPI inflation data has bolstered expectations of Reserve Bank of Australia rate hikes.

USD/JPY meets support near 157.00

USD/JPY retreats for the third consecutive day on Friday, revisiting the 157.00 region before attempting some recovery as investors continue to assess the latest BoJ meeting, where the central bank left rates unchanged, as widely anticipated.

Gold sinks to fresh yearly lows despite risk-off mood as Fed rate hike bets weigh

Gold slips to fresh year-to-date lows on Friday. The metal struggles despite a risk-off mood across markets, as expectations of further Federal Reserve (Fed) interest rate hikes continue to dominate price action, leaving Gold on track to end the month in negative territory.

Ripple Price Forecast: XRP bulls defend $1.20 as sell-side pressure triggers liquidations

Ripple (XRP) trades around $1.25 on Friday, rising from a short-term support level established at $1.20. This minor upward correction follows a sharp sell-off, triggered amid reports of a hack attack on the Binance exchange that impacted approximately $6.3 billion. The attack drove the broader crypto market on edge, as Binance suspended both deposits and withdrawals to contain the situation.

BoJ recap: A pause for now... but Japan has entered a new inflation phase

The Bank of Japan left its short-term policy rate unchanged at 1.25% but delivered a distinctly hawkish message on the risk of an inflation overshoot. The decision passed by 8-1, with board member Takata dissenting in favour of an increase to 1.5%, while Governor Kazuo Ueda stressed that the Bank would continue adjusting policy as needed.

A hot US economy is supposed to sink Gold. It didn't. Here's why

Gold (XAU/USD) remains under pressure near $4,000, as stronger-than-expected United States (US) economic data reinforce expectations of another Federal Reserve (Fed) interest rate hike in December. Economic growth is accelerating, inflation remains elevated, and borrowing costs could rise further.