USD/CAD Price Forecast: US-Canada trade war pressures Canadian Dollar

USD/CAD ticks higher to near 1.3886 as the US-Canada trade war keeps the Canadian Dollar under pressure.
Canada announces retaliatory tariffs of upto 50% on the US.
Investors keenly await Fed Warsh’s speech at the Jackson Hole Symposium.

Sagar Dua FXStreet

The Canadian Dollar (CAD) trades lower against the US Dollar (USD) on Thursday, with USD/CAD trading marginally higher to near 1.3886. The Loonie faces selling pressure as the ongoing trade war between the United States (US) and Canada has raised Ottawa's economic concerns.

Canadian Dollar Price This week

The table below shows the percentage change of Canadian Dollar (CAD) against listed major currencies this week. Canadian Dollar was the weakest against the Australian Dollar.

	USD	EUR	GBP	JPY	CAD	AUD	NZD	CHF
USD		0.21%	0.32%	0.30%	0.56%	-0.26%	0.47%	0.52%
EUR	-0.21%		0.12%	-0.02%	0.35%	-0.47%	0.26%	0.32%
GBP	-0.32%	-0.12%		-0.19%	0.24%	-0.55%	0.14%	0.21%
JPY	-0.30%	0.02%	0.19%		0.31%	-0.48%	0.26%	0.30%
CAD	-0.56%	-0.35%	-0.24%	-0.31%		-0.77%	-0.06%	-0.03%
AUD	0.26%	0.47%	0.55%	0.48%	0.77%		0.72%	0.79%
NZD	-0.47%	-0.26%	-0.14%	-0.26%	0.06%	-0.72%		0.06%
CHF	-0.52%	-0.32%	-0.21%	-0.30%	0.03%	-0.79%	-0.06%

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Canadian Dollar from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent CAD (base)/USD (quote).

Last week, Washington imposed 50% tariffs on a range of Canadian goods that took effect on Saturday after both nations failed to reach a trade deal. In retaliation, Canadian Prime Minister (PM) Mark Carney also announced retaliatory tariffs of up to 50% on USD 20 billion of imports.

Tariffs seen trimming Canada growth as inflation impact stays modest

According to TD Securities, the newly announced US Section 338 measures and Canada’s response are expected to deliver a measurable drag on activity, with analysts “look[ing] for 338 tariffs and CAD retaliation to shave ~0.3pp from GDP by 2027.”

They note that the growth effects will be “front-loaded over Q3/Q4, while the fiscal response takes longer to materialize,” implying the bulk of the hit will be felt in late 2026 before government support fully offsets some of the damage.

Meanwhile, the US Dollar trades marginally higher, with investors awaiting comments from Federal Reserve (Fed) Chairman Kevin Warsh at the Jackson Hole Symposium on Friday.

USD/CAD Technical Analysis

USD/CAD trades at 1.3887, keeping a bearish tone as spot remains capped beneath the 20-day exponential moving average (EMA) at 1.3908 and the 50.0% Fibonacci retracement at 1.3901.

The Relative Strength Index (RSI) at 44 stays below the midline, hinting at subdued bullish momentum and reinforcing the idea that rebounds are likely to face selling interest rather than extend into a sustained recovery.

On the topside, immediate resistance is clustered around 1.3901/1.3908 from the 50.0% Fibonacci retracement and the 20-day EMA, with further barriers at the 38.2% retracement at 1.3983 and the 23.6% level at 1.4085. On the downside, initial support emerges at the 61.8% retracement at 1.3819, followed by the 78.6% level at 1.3702 and the prior swing low anchor near the 100% retracement at 1.3553, where buyers may attempt to stem deeper losses.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

Economic Indicator

Fed's Chair Warsh speech

Kevin Warsh took office as chairman of the Board of Governors of the Federal Reserve in May 2026, for a four-year term ending in 2030. His term as a member of the Board of Governors will expire in May 2040. Warsh, born in Albany (New York) on April 13, 1970, is an American financier and attorney who already served as a member of the Fed Board of Governors from 2006 to 2011 and was significantly involved in the central bank's response to the financial crisis.

GBP/USD stays weak below 1.3600 as USD bulls await Warsh's speech

GBP/USD is consolidating near the lower end of its weekly range, below the 1.3600 mark, during European trading hours on Thursday. The pair's downside, however, remains cushioned as traders await Fed Chair Warsh's speech on Friday for more cues about the US central bank's interest rate path before placing fresh directional bets.

EUR/USD holds range around 1.1650 as USD steadies

EUR/USD keeps its range around 1.1650 in the European session on Thursday. Hawkish ECB expectations support the pair as the US Dollar consolidates after the US PCE data-driven advance. The focus remains on Middle East developments and US Jobless Claims data.

Gold struggles to build on gains as traders await Fed Chair Warsh's speech for rate cues

Gold struggles to capitalize on modest Asian session gains on Thursday and remains below its highest level since May 14, touched earlier this week. Traders now seem hesitant to place aggressive directional bets and wait for US Federal Reserve Chair Kevin Warsh's speech at the Jackson Hole Symposium on Friday for cues on the future policy path. The outlook, in turn, will play a key role in influencing the US Dollar price dynamics and provide some meaningful impetus to the non-yielding bullion.

Ripple eases to $1.40, Solana hits $100, DOGE capped below $0.10

Ripple (XRP) and Dogecoin (DOGE) are facing downside pressure after double-digit gains last week, while Solana (SOL) extends its rally to $100. The technical outlook for XRP, SOL, and DOGE points to potential upside as the broader market sustains a risk-on sentiment.

Jackson Hole kicks off after upside PCE surprise

In China, industrial profits rose 17.6% y/y to CNY 4.58tn in the first seven months of 2026, slowing from an 18.7% increase in January-June. The moderation follows several months of strong profit growth around 20% y/y, supported by higher producer prices and solid manufacturing activity.

Kevin Warsh’s Jackson Hole dilemma: Say too much, too little, or just enough

Kevin Warsh is preparing to deliver his first Jackson Hole speech as Federal Reserve (Fed) Chair on Friday, and expectations extend well beyond whether interest rates will be raised or left unchanged in September.