The Canadian dollar is experiencing mixed influences, hovering near recent lows against the US dollar. Renewed US dollar strength and falling oil prices are weighing on the CAD, offsetting supportive domestic factors. While improved fundamentals offer some floor, softer labor dynamics and a neutral Bank of Canada stance are limiting upside potential.
- The Canadian dollar softened toward 1.39 per US dollar.
- Renewed US dollar support and weaker oil prices are weighing on the CAD.
- US jobless claims fell sharply, reinforcing confidence in the US labor market.
- President Trump’s calmer tone on Iran pared the geopolitical premium in crude.
- Unemployment holding near 6.8% reinforces the Bank of Canada’s neutral stance.
- Broader fundamentals have improved modestly, providing a floor.
- USD/CAD inches lower after three days of gains, trading around 1.3890.
- USD/CAD remains within an ascending channel pattern, suggesting a persistent bullish bias.
- RSI above the 50 midline keeps dips shallow.
Overall, the Canadian dollar’s performance is being pulled in different directions. External factors, such as fluctuations in the US dollar and oil prices, significantly impact its value. Domestically, while underlying economic conditions have somewhat improved, limitations remain, creating a complex environment for the currency. Technical analysis suggests a potential for continued strength against the US dollar, although dips may be limited.