CAD little changes on the day – Scotiabank

The Canadian Dollar (CAD) continues to range trade, Scotiabank's Chief FX Strategists Shaun Osborne and Eric Theoret report.

CAD holds range after CPI implies on hold BoC

"A mild pick up in Canadian inflation yesterday helps maintain the outlook for BoC policy to remain on hold for the moment at least and possibly for some time. PM Carney commented yesterday that negotiations with the US will intensify but seemed to concede that tariffs are likely to remain a part of the landscape for Canada as the 'commercial landscape globally has changed'.

"While US/ Canada spreads have narrowed a little this week, commodity prices/terms of trade have weakened somewhat. Along with the broader rebound in the USD, factors driving the CAD have shifted a little against the CAD, nudging our fair value estimate up to 1.3626."

"Spot is firm, near the top of the recent trading range but short-term price trends remain rather flat and the USD still has some work to do to flex a bit more sustainably. USD resistance is 1.3740/50 and, firmer, at 1.3800/10. Support is 1.3650/70."