The Canadian Dollar (CAD) remains stable around the 1.44 mark amid market caution before US tariffs are announced. According to Scotiabank’s Chief FX Strategist, the uncertain global trade landscape is affecting commodity currencies, with fair value estimated at 1.4135.
Intraday movements reflect indecision in CAD trading, as recent gains have stalled. Current trading ranges suggest a potential rise to 1.4450, with support identified at 1.4330. The focus continues to be on upcoming developments surrounding tariffs and their global impact.
Canadian Dollar Holds Amid Uncertainty
This recent snapshot of the Canadian Dollar shows it holding firm near 1.44, a level it’s been orbiting with relatively low conviction. The measured stillness, as observed by Scotiabank’s Osborne, ties back to worries around incoming tariffs from the United States. These external trade shifts seem to be weighing on commodity-linked currencies in particular, forcing markets to reassess valuations in real time.
When we compare the actual exchange rate to the fair value mark set at 1.4135, the current level puts CAD slightly above what some models suggest is justified. This tells us one thing clearly—it may not yet have priced in broader macro risks. Price action during the day shows hesitation, with gains capped and no clear trend emerging across sessions. Buyers are not stepping in strongly, and sellers have also paused, perhaps awaiting more clarity on policy or trade strategy shifts that could quickly upend sentiment.
Technical pricing hints at a casual ceiling just under 1.4450, where upside momentum has faced repeated resistance. Meanwhile, on the downside, the 1.4330 area has provided a platform for bids to emerge. Any break on either side would likely be met with swift follow-through, largely because positioning has become thin as traders remain cautious. This range-bound movement doesn’t signal disinterest—it signals wariness for now.
Market Reaction To Tariff Developments
Tariffs, depending on their size and scope, will probably affect risk appetite, especially in the currencies of economies tied closely to exports. We have seen this before: a sudden policy turn can spark large, unpredictable shifts in pairings like USD/CAD. The effect won’t just land on headlines—it’ll flow through options premiums, widen spreads, and shift implied vols. Timing our response to such moves needs balance. Moving too early and exposure increases; too late and opportunity evaporates.
We’ll be watching correlation shifts closely. If commodity prices start pushing back upwards and the Canadian Dollar doesn’t follow, that divergence will say more than any headline can. It suggests sentiment cracks beneath the surface and tells us to dig deeper into risk positioning and hedging flows. For now, measured patience mixed with readiness to act will serve best. Let the levels do the talking first.
