Canadian Dollar remains in steady range on Tuesday

• The Canadian Dollar remained tepid against the Greenback on Tuesday.
• Housing Starts in Canada rose in December, but data impact is low.
• Markets are brushing off the latest tariff tirade from President Trump.

The Canadian Dollar (CAD) continues to hold within it's medium-term technical range against the US Dollar (USD), keeping the USD/CAD pair pinned near 1.4300 after a firm recovery from multi-decade lows last week. Canadian economic data is thin and strictly low-tier this week, and the market is taking US President Donald Trump's latest trade wear rhetoric in stride as a full walk back is expected once again.

Canada saw a firm rebound in issued Building Permits in December, reversing a previous cyclical contraction. However the data is back-dated too far to be of any significance, providing only thin support for the Loonie. President Trump's latest threat to impose a flat 25% tariff on all imported steel and aluminum into the US has been kicked down the road to March 12, leading markets to believe that this is just the next iteration of empty threats that will result in more headlines than actual action on US trade policies.

Daily digest market movers: Canadian Dollar holds steady, markets brush off tariff talk

• The Canadian Dollar traded within one-tenth of one percent of Tuesday's opening bids against the Greenback.
• Canadian Building Permits rebounded to 11.0% in December, up from November's revised -5.6% contraction.
• Investors hoping for signals of incoming rate cuts were likely disappointed by Federal Reserve (Fed) Chair Jerome Powell's testimony before the US Senate Banking Committee.
  • Jerome Powell Testimony Live: Not for the Fed to comment on tariff policy
• President Trump signed executive orders calling for 25% tariffs on steel and aluminum imports starting on March 12, but investors expect another last-minute pivot from the Trump administration.
• Within less than 24 hours, President Trump's latest tariff issuance has gone from no exemptions and no exclusions to include possible exemptions for Australia and China.
• Global markets will be keeping a close eye on Wednesday's US Consumer Price Index (CPI) inflation print, which is expected to show US inflation remaining stuck near 2.9% YoY.

Canadian Building Permits

Canadian Dollar price forecast

The Canadian Dollar (CAD) remains buried within consolidation against the Greenback. The Loonie briefly fell to its lowest point in two decades against the US Dollar last week, sending USD/CAD to its highest bids since 2002, but a walkback of President Trump's tariff threats last week crippled any chance of a meaningful shift in the pair's dynamic.

Near-term price action remains hobbled at the 50-day Exponential Moving Average (EMA) near the 1.4300 handle. Markets are awaiting a reason to risk betting on momentum in either direction, though Loonie bulls will have an eye on the 200-day EMA drifting toward 1.4000.

USD/CAD daily chart