USDCAD SELL

62
USD/CAD rallies further, approaches 1.3900 on higher levies to Canada
The US Dollar keeps marching higher, as the Canadian Dollar struggles after Trump decided to increase tariffs to Canada to 35% from the previous 25%, escalating the trading tension with one of its main trading partners. The US President justified his decision on Canada’s alleged reluctance to cooperate on curbing the traffic of fentanyl and other drugs across the US border
The year will be politically marked by Trump’s return to the White House. A Republican government is seen as positive for financial markets, but Trump’s pledge to cut taxes and impose tariffs on foreign goods and services may introduce uncertainty to both the political and economic landscape.

Canada’s political crisis peaked in late 2024 with a no-confidence vote against Prime Minister Justin Trudeau, leading to snap elections and a weakened Liberal minority government. Policy uncertainty and economic challenges dominate 2025’s outlook, raising concerns over market stability and investor confidence.

The BoC is set to continue easing interest rates through 2025, at least at a faster pace than the Fed is expected to, which could apply pressure on CAD’s already-rising rate differential.

SUPPORT 1.38444

SUPPORT 1.38039

SUPPORT 1.37621

RESISTANCE 1.38889

RESISTANCE 1.39049

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