The USD/CAD pair remains subdued below the 1.4400 mark, weighed down by a combination of a softer US Dollar and a drop in Treasury yields. The greenback has faced renewed selling pressure as expectations for a prolonged Federal Reserve rate-hike cycle ease, pushing the US Dollar Index lower. Meanwhile, the decline in US Treasury yields has further dampened investor demand for the currency, reducing its appeal against the Canadian Dollar.
On the Canadian side, the loonie found modest support from stable oil prices, given Canada’s status as a major crude exporter. However, broader risk sentiment remains cautious, limiting a stronger push for the Canadian Dollar. Market participants are now closely monitoring upcoming US economic data, including retail sales and producer prices, for additional clues on the Fed’s policy path.
As the pair hovers under the psychological 1.4400 threshold, traders are treading carefully amid shifting macroeconomic dynamics. The near-term direction for USD/CAD will likely hinge on upcoming data releases and market sentiment around global central bank policies.
