CAD holds range despite headwinds from risk, commodities – Scotiabank

Canada’s 25% counter tariffs on non-USMCA compliant vehicles came into force just after midnight, Scotiabank's Chief FX Strategist Shaun Osborne notes.

USD continues to meet resistance above the mid-1.42 zone

"The Canadian Dollar (CAD) is taking the heightened market volatility and increased uncertainty in its stride, at least for now and remains essentially range-bound against a weaker USD."

"Our fair value model suggests the CAD is trading right about where it should be against an equilibrium estimate of 1.4189—little changed from yesterday. That is a 'win' for the CAD in an environment of weak equities, soft commodities and rising US yields but it does rather highlight what an unusual environment we are in right now."

"Spot is holding within this week’s trading range this morning. USD gains continue to meet resistance above the mid-1.42 zone but yesterday’s rebound from the intraday low at 1.4145/50 suggests a firm-ish low in place for now ahead of 1.4025/30."