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USD/CAD holds steady as rate gap keeps CAD on a weekly slide

The pair was around 1.4141, near mid-July levels, as DXY eased after its Thursday peak near 101.40.

Reported · Written up by our desk · Major Pairs

FXStreet reports that USD/CAD traded little changed on Friday as the US dollar paused after a strong rally earlier in the week.

The newsletter said the Canadian dollar has not gained meaningful relief from a softer greenback or a pause in Treasury yields, leaving USD/CAD on track for a third consecutive weekly rise, with the pair around 1.4141 near mid-July levels.

FXStreet attributed the pressure on CAD to diverging central bank paths, noting the Fed raised rates by 25 basis points last week to 3.75% to 4.00% and signaled more increases may be needed this year, while the Bank of Canada kept its policy rate at 2.25% with a more cautious tone.

It added that the widened front-end yield differential has favored the US dollar, with the US Dollar Index around 101 after reaching 101.40 on Thursday, its highest level in nearly two.

Latest closeDollar index 101.29 ▲0.2%

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