The CAD is showing moderate outperformance against the USD, supported by stronger commodities and firm risk sentiment. The Bank of Canada maintained its benchmark rate at 2.25%, indicating that current policy is suitable for growth. The CAD's fair value estimate has improved, reflecting its strongest position since last June, report Scotiabank Chief FX Strategist Shaun Osborne and FX Strategist Eric Theoret.

CAD strengthens against USD

"The CAD continues to pressure major USD support in the mid-1.35 area (last June’s low at 1.3540) after spot pushed below long-term trend support (1.3660 earlier this week)."

"Trend momentum signals are aligned bearishly for the USD across short-, medium- and long-term studies which tilts technical risks firmly towards limited USD counter-trend gains."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)