Scotiabank’s Chief FX Strategist, Shaun Osborne, highlights the recent implementation of Canada’s 25% counter-tariffs on non-USMCA compliant vehicles. Despite prevailing market volatility and uncertainty, the Canadian Dollar (CAD) has maintained a relatively stable range against a weakening USD.
The bank’s fair value model indicates the CAD is trading near its equilibrium estimate of 1.4189, a marginal change from the previous day. This stability is considered a positive outcome for the CAD, particularly given the current context of declining equity markets, soft commodity prices, and increasing US yields.
Current spot rates remain within the established weekly trading range. USD gains continue to encounter resistance above the 1.4250 level, while the recent rebound from the intraday low of 1.4145/50 suggests a near-term support level ahead of 1.4025/30.
