Created
: 2025.09.18
- English
- English
- What's Myforex
- Share
- Use tools
- Get information
- What's New
- Help center
- About us
- Customer support
- Terms and policies
-
-
PortfolioShare your portfolio and performance in real time -
Events & contestsEvents and contests held by retail brokers around the world
-
-
Real-time spread comparisonCompare spreads of major retail brokers in real time -
Volatility analysisVisualize volatility as a measure of daily market activity -
Swap point comparisonCompare buy and sell swap values for each broker by symbol -
Market rates & chartsCheck prices for all instruments offered by each broker -
IndicatorsProviding in-house developed indicators for MT4/MT5 -
Trading calculatorsCalculation tools for each broker to help you trade
-
-
World FX newsLatest news on forex and cryptocurrencies from around the world -
Broker informationTrading information of retail brokers worldwide -
MetaTrader4/5 user guideUser guide collection for the latest MetaTrader4/5 -
Economic calendarRelease calendar for indicators from official sources of major economies
Canadian Dollar pares away more gains as US Dollar recovers ground
World FX news
Breaking news
Canadian Dollar pares away more gains as US Dollar recovers ground
New
2025.09.19 04:29
2025.09.19 04:29
2025.09.19 04:29
- The Canadian Dollar drifted lower on Thursday, falling back against the US Dollar.
- Greenback flows have dominated USD/CAD, leaving the Loonie in a data-light lurch.
- Despite market jubilation about rate cuts, manic investors remain leery.
The Canadian Dollar (CAD) stumbled into a second straight day of declines on Thursday. The US Dollar (USD) continues to gain ground despite a fresh interest rate cut from the Federal Reserve (Fed), as market tensions surrounding shaky US economic conditions and still-high Treasury yields keep the safe-haven Greenback well-bid.
The Bank of Canada (BoC) delivered its own quarter-point interest rate cut this week, kicking out what little support the Loonie had against the US Dollar. Rate markets are now sceptical about the BoC's ability to deliver further economy-supporting rate trims looking forward, with the Canadian economy grappling with flagging data releases and recession concerns buoyed into the high end.
Daily digest market movers: Canadian Dollar falls back as central banks race rate cuts
- The Canadian Dollar fell around one-sixth of one percent against the US Dollar on Thursday.
- The Loonie's two-day decline has extended to 0.6% top-to-bottom.
- Despite near-term declines, the Canadian Dollar is still trading within a comfortable range against the US Dollar.
- The BoC and the Fed both delivered quarter-point rate cuts this week, and it now comes down to which CB will deliver further rate cuts through the remainder of the year.
- General market sentiment adds complexity to the rate differential. Greenback flows remain elevated despite Fed rate cuts, as Treasury yields remain high. Ongoing weakness in US economic data could see the US Dollar climb further despite rate cuts as risk aversion returns to markets.
Canadian Dollar price forecast
The Canadian Dollar has eased back against the US Dollar heading through the midweek, sending USD/CAD higher after a third straight bounce from a technical support zone near 1.3740. The pair is now back into a congestion point at the 50-day Exponential Moving Average (EMA) near 1.3790, and near-term price action is struggling to find meaningful momentum on either side of the 1.3800 handle.
USD/CAD daily chart
Canadian Dollar FAQs
The key factors driving the Canadian Dollar (CAD) are the level of interest rates set by the Bank of Canada (BoC), the price of Oil, Canada's largest export, the health of its economy, inflation and the Trade Balance, which is the difference between the value of Canada's exports versus its imports. Other factors include market sentiment - whether investors are taking on more risky assets (risk-on) or seeking safe-havens (risk-off) - with risk-on being CAD-positive. As its largest trading partner, the health of the US economy is also a key factor influencing the Canadian Dollar.
The Bank of Canada (BoC) has a significant influence on the Canadian Dollar by setting the level of interest rates that banks can lend to one another. This influences the level of interest rates for everyone. The main goal of the BoC is to maintain inflation at 1-3% by adjusting interest rates up or down. Relatively higher interest rates tend to be positive for the CAD. The Bank of Canada can also use quantitative easing and tightening to influence credit conditions, with the former CAD-negative and the latter CAD-positive.
The price of Oil is a key factor impacting the value of the Canadian Dollar. Petroleum is Canada's biggest export, so Oil price tends to have an immediate impact on the CAD value. Generally, if Oil price rises CAD also goes up, as aggregate demand for the currency increases. The opposite is the case if the price of Oil falls. Higher Oil prices also tend to result in a greater likelihood of a positive Trade Balance, which is also supportive of the CAD.
While inflation had always traditionally been thought of as a negative factor for a currency since it lowers the value of money, the opposite has actually been the case in modern times with the relaxation of cross-border capital controls. Higher inflation tends to lead central banks to put up interest rates which attracts more capital inflows from global investors seeking a lucrative place to keep their money. This increases demand for the local currency, which in Canada's case is the Canadian Dollar.
Macroeconomic data releases gauge the health of the economy and can have an impact on the Canadian Dollar. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the CAD. A strong economy is good for the Canadian Dollar. Not only does it attract more foreign investment but it may encourage the Bank of Canada to put up interest rates, leading to a stronger currency. If economic data is weak, however, the CAD is likely to fall.
Last updated
: 2025.09.19
Related articles
Canadian Dollar pares away more gains as US Dollar recovers ground
2025.09.18 19:28Donald Trump says the US is so strong it can just make other countries do things
2025.09.18 18:25Forex Today: No changes expected from the BoJ
2025.09.18 17:47USD/CHF bounces from 14-year lows after Fed rate cut
2025.09.18 17:46GBP/USD falls to 1.3550 as BoE holds rates, trims QT
2025.09.18 15:39Euro weakens for second day, Greenback rebounds on Fed guidance and strong US data
2025.09.18 15:23
FXStreet is a forex information website, delivering market analysis and news articles 24/7.
It features a number of articles contributed by well-known analysts, in addition to the ones by its editorial team.
Founded in 2000 by Francesc Riverola, a Spanish economist, it has grown to become a world-renowned information website.
Was this article helpful?
We hope you find this article useful. Any comments or suggestions will be greatly appreciated.
We are also looking for writers with extensive experience in forex and crypto to join us.
please contact us at [email protected].
Thank you for your feedback.
Thank you for your feedback.
Most viewed
Gold trims post-Fed losses, consolidates below record highs
Gold (XAU/USD) stabilizes on Thursday after a sharp reversal following the Federal Reserve's (Fed) interest rate decision.
New
2025.09.18 21:44Canadian Dollar pares away more gains as US Dollar recovers ground
The Canadian Dollar (CAD) stumbled into a second straight day of declines on Thursday.
New
2025.09.18 19:28Silver price today: Silver rises, according to FXStreet data
Silver prices (XAG/USD) rose on Thursday, according to FXStreet data.
New
2025.09.18 18:30Donald Trump says the US is so strong it can just make other countries do things
United States (US) President Donald Trump declared on Thursday that the US is so strong it can just "get people to do things". Trump was speaking to reporters aboard Air Force One.
New
2025.09.18 18:25Silver Price Forecast: XAG/USD steadies above $41.50
Silver (XAG/USD) trims earlier intraday losses on Thursday, recovering from a five-day low marked on Wednesday in the aftermath of the Federal Reserve's (Fed) interest rate cut decision. At the time of writing, the white metal is trading near $41.81, rebounding from an intraday trough of $41.20.
New
2025.09.18 18:20Gold declines after strong US data offsets Fed rate cut
Gold Price retreats during the North American session and is down 0.39% in the aftermath of the Federal Reserve's (Fed) rate cut decision on Wednesday and better than expected Initial Jobs Claims data. At the time of writing, XAU/USD trades at $3,643 after hitting a daily high of $3,673.
New
2025.09.18 17:53Forex Today: No changes expected from the BoJ
The US Dollar (USD) clocked marked gains on Thursday, as market participants parsed Wednesday's rate cut by the Federal Reserve and the cautious message from Chair Powell at his subsequent press conference.
New
2025.09.18 17:47USD/CHF bounces from 14-year lows after Fed rate cut
The Swiss Franc (CHF) weakens against the US Dollar (USD) for a second consecutive day on Thursday, with USD/CHF extending its recovery after a volatile midweek reaction to the Federal Reserve's (Fed) interest rate decision.
New
2025.09.18 17:46Dow Jones Industrial Average leaks higher as rate cut bolsters tech
The Dow Jones Industrial Average (DJIA) rose on renewed bullish sentiment across broader markets on Thursday, bolstered by the Federal Reserve's (Fed) decision to cut interest rates for the first time in nine months.
New
2025.09.18 17:09GBP/USD falls to 1.3550 as BoE holds rates, trims QT
The British Pound reversed its course, drops over 0.51% following the Bank of England's decision to hold rates unchanged, after the Fed began its 2025 easing cycle. The GBP/USD trades at 1.3551 after hitting a daily high of 1.3660.
New
2025.09.18 15:39Disclaimer:
All information and content provided on this website is provided for informational purposes only and is not intended to solicit any investment. Although all efforts are made in order to ensure that the information is correct, no guarantee is provided for the accuracy of any content on this website. Any decision made shall be the responsibility of the investor and Myforex does not take any responsibility whatsoever regarding the use of any information provided herein.
The content provided on this website belongs to Myforex and, where stated, the relevant licensors. All rights are reserved by Myforex and the relevant licensors, and no content of this website, whether in full or in part, shall be copied or displayed elsewhere without the explicit written permission of the relevant copyright holder. If you wish to use any part of the content provided on this website, please ensure that you contact Myforex.
Myforex uses cookies to improve the convenience and functionality of this website. This website may include cookies not only by us but also by third parties (advertisers, log analysts, etc.) for the purpose of tracking the activities of users. Cookie policy
