USD/CAD Exchange Rate at a 56-Month High

FXOpen

11 Dec 2024, 09:13

As evidenced by the USD/CAD chart, yesterday the rate climbed above 1.4190 – a level not seen since April 2023, when the world was gripped by panic over the spread of the coronavirus.

Today, the weakness of the Canadian dollar relative to the USD is being influenced by a rich fundamental backdrop. As reported by the media:

→ Formerly elected President Donald Trump has previously stated that he would impose a 25% tariff on all goods from Mexico and Canada as soon as he takes office on 20 January, joking that Canada should become the 51st state. Yesterday, Trump posted on social media that he looks forward to meeting with Canadian Prime Minister Trudeau again to "continue our in-depth discussions on tariffs and trade."

→ At 17:45 GMT+3 today, the Bank of Canada will announce its decision. It is expected to cut its interest rate by 50 basis points to 3.25% and likely signal that further rate cuts are possible in light of the sharp rise in unemployment levels.

→ At 16:30 GMT+3 today, the Consumer Price Index (CPI) data will be released. It is expected that US inflation will remain unchanged.

As a result, heightened volatility is highly likely today, which could significantly affect the nature of the current upward trend.

Note that on 25–26 November, a spike in volatility was observed on the USD/CAD chart, visible through the ATR indicator, which caused the channel's slope to become less steep. Today’s batch of news carries the highest significance: traders should prepare for both the scenario of a new 56-month high being reached and an attempt by bears to reverse the trend.

Trade over 50 forex markets 24 hours a day with FXOpen. Take advantage of low commissions, deep liquidity, and spreads from 0.0 pips (additional fees may apply). Open your FXOpen account now or learn more about trading forex with FXOpen.

This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.