Canadian Dollar Holds Near Monthly Lows

The Canadian Dollar touched 1.37 against the USD, the lowest since January 2026. Over the past 4 weeks, US Dollar Canadian Dollar gained 0.11%, and in the last 12 months, it decreased 4.13%.

The Canadian dollar weakened toward 1.37 per US dollar on Monday, hovering near monthly lows as global markets balanced a swift pivot in US trade policy against a softening domestic inflation outlook. While the loonie initially rose after the US Supreme Court struck down previous emergency duties, the rally evaporated as President Trump invoked Section 122 to impose a new 15% global surcharge. This trade friction re-established a major headwind for Canada's export-heavy economy just as January CPI data showed inflation cooling to 2.3%, raising bets that the Bank of Canada may soon abandon its 2.25% pause. The currency faced further pressure from a resilient greenback, supported by hawkish signals from incoming Fed leadership and US core PCE holding at 3%. Even with a modest firming in oil prices, the loonie remained on the defensive as the narrowing of Canada's yield advantage and renewed protectionist risks outweighed the brief optimism of the landmark court ruling.

The Canadian dollar weakened near 1.37 per US dollar on Friday, near monthly lows as surging US yields and a retreat in oil prices outweighed the relief rally from the US Supreme Court striking down global tariffs. While the court’s decision to invalidate emergency trade duties provided a boost to sentiment the loonie remained pressured by a widening yield gap after US core PCE inflation hit 3% to reinforce a hawkish Fed stance. Domestically the Bank of Canada remains on pause at 2.25% as January CPI of 2.6% and soft US GDP of 1.4% complicated the outlook for synchronized easing. Additionally crude oil prices pared weekly gains despite a 9 million barrel drop in US inventories to weaken the commodity backing that typically supports the currency. With the BoC signaling that current rates are appropriate and US-Iran tensions keeping the greenback firm on safe haven flows the loonie faces resistance as it balances trade policy relief against diverging monetary paths.