The Canadian Dollar is losing ground as renewed trade negotiations between the United States and Canada get underway, according to Scotiabank strategists Shaun Osborne and Eric Theoret. The USD/CAD pair is currently trading in the mid-1.38 range, indicating CAD weakness despite holding near recent highs against the US Dollar.
The loonie’s underperformance comes at a critical juncture as both nations enter fresh trade discussions, creating uncertainty for the currency. The pair’s behavior suggests traders are positioning defensively ahead of potential policy announcements or developments from these talks. Market participants are closely monitoring the negotiations for any signals that could impact bilateral trade flows and currency valuations.
The mid-1.38 level represents a key technical area for the currency pair, with the CAD struggling to gain traction despite broader dollar movements. Trade-sensitive currencies like the Canadian Dollar typically experience heightened volatility during bilateral negotiation periods.
FXnCO Insight
Traders should watch the mid-1.38 level closely as a break higher could signal extended CAD weakness if trade talks produce unfavorable outcomes for Canadian exporters.
Source: FXStreet