Scotiabank strategists Shaun Osborne and Eric Theoret report that the Canadian Dollar (CAD) is quiet against the US Dollar (USD), underperforming most G10 peers as yield spreads move in favor of the USD following recent Federal Reserve (Fed) and Bank of Canada (BoC) meetings [1]. The bank’s fair value estimate for USD/CAD has risen to 1.3498, reflecting the shift in yield spreads after the Fed’s softened dovish guidance [1]. Technical analysis from Scotiabank indicates a neutral-to-bullish bias for USD/CAD, with risks tilting higher and a notable rise in the RSI suggesting bullish momentum [1]. The strategists anticipate meaningful resistance around the 200-day moving average at 1.3802 and expect the pair to remain range-bound between 1.3700 and 1.3750 in the near term [1]. The outlook for relative central bank policy is shifting, with the CAD lagging most G10 peers and entering Thursday’s North American session unchanged versus the USD [1].
CONCLUSION
Scotiabank sees USD/CAD range risks tilting higher, driven by widening yield spreads and shifting central bank policy outlooks. Technicals suggest a neutral-to-bullish bias, with resistance expected at 1.3802 and a near-term range between 1.3700 and 1.3750. The CAD continues to lag its G10 peers, reflecting current market dynamics.