USDCAD – Daily Chart
USDCAD has been pressing higher into January but a rebound in February may have stalled with support at the 1.415 level ahead of the key number support at 1.40.
Data from the US and Canadian economies will come late for the Hong Kong session but could spark some volatility in the pair.
US retail sales come at 8:30pm HKT on Monday, with Canadian inflation data at the same time on Tuesday. But with a new Prime Minister, the price moves may be driven by geopolitics.
Mark Carney was a former governor of the Bank of England and has taken over from Justin Trudeau. One of his first mandates is to push back on Donald Trump’s designs on Canada as a new US state.
In his talks with Trudeau, Trump questioned the borders set in the 1908 Treaty signed by former President Teddy Roosevelt and King Edward VII.
“The artificial line of separation drawn many years ago will finally disappear, and we will have the safest and most beautiful Nation anywhere in the World,” he said, adding that Canadians would pay “much less tax”.
Trump moved quickly to add 25% tariffs on Canadian goods with aluminium and steel being hit.
“We didn’t ask for this fight,” Carney said, but “the Americans want our resources, our water, our land and our country”.
“America is not Canada. And Canada never ever will be part of America in any way, shape or form,” he added. Carney is keen on reciprocal tariffs against the US, even though he deplores them in principle, and said that “Canada will win”.
In the short-term, the tariff wars could add to the volatility in the USDCAD and the battle for Canada’s sovereignty is an interesting distraction to economic data.
