CAD holds trading range – Scotiabank

April has been good for the Canadian Dollar (CAD) (it’s strongest month towards the US Greenback (USD) since 2019) however spot continues to vary commerce, Scotiabank’s Chief FX Strategist Shaun Osborne notes.

FV estimate slips beneath 1.38

“The election has been inconsequential for the CAD to this point however now the arduous work for the Carney authorities has began. There could also be no rush to interact with the US on commerce; creating US financial headwinds from President Trump’s tariff insurance policies counsel that persistence could also be the very best technique for now. Elements driving the alternate charge proceed to edge within the CAD’s favour.”

“Our honest worth estimate for spot has nudged beneath 1.38 this week for the primary time since final October and sits at 1.3789 at the moment. The commonly comfortable USD and calmer US asset markets are components however decrease US yields and narrower US/Canada spreads since early March are a lift for the CAD. Canada repots February industry-level GDP. Development is predicted to be flat within the month, reflecting tariff uncertainty, and slower at 1.7% for the yr.”

“Spot’s consolidation is extending on the short-term charts. Congestion between 1.3575/1.3775 continues to supply some help to the USD however the broader USD downtrend stays intact and bearish pattern momentum will curb USD rebounds within the near-term. Intraday resistance is 1.3880, with robust resistance probably nearer 1.40. Assist is 1.3775/80 and (key) 1.3745.”