Canadian Dollar Gains for Third Straight Week

2026-08-14 20:08 By Isabela Couto 1 min. read

The Canadian dollar strengthened to 1.39 per USD, posting a third consecutive weekly gain as yield spreads narrowed.

Domestic factory data supported the recent narrowing in the gap between US and Canadian bond yields.

The spread between Canada’s 2-year yield and the US equivalent has narrowed by about 17 basis points this month.

Canadian factory sales rose 0.1% in June from May, marking a fifth consecutive monthly gain, while sales volumes increased 1.2%.

Meanwhile, US retail sales unexpectedly fell in July by the most in more than a year.

Recent data also showed a stronger Canadian labor market and weaker US employment, reducing expectations for a Federal Reserve rate hike this year while raising the prospect of a BoC hike if energy prices remain elevated.

Canada’s economy is estimated to have expanded at an annualized 3.4% in the second quarter, well above the Bank of Canada’s 2.5% forecast.



News Stream
Canadian Dollar Gains for Third Straight Week
The Canadian dollar strengthened to 1.39 per USD, posting a third consecutive weekly gain as yield spreads narrowed. Domestic factory data supported the recent narrowing in the gap between US and Canadian bond yields. The spread between Canada’s 2-year yield and the US equivalent has narrowed by about 17 basis points this month. Canadian factory sales rose 0.1% in June from May, marking a fifth consecutive monthly gain, while sales volumes increased 1.2%. Meanwhile, US retail sales unexpectedly fell in July by the most in more than a year. Recent data also showed a stronger Canadian labor market and weaker US employment, reducing expectations for a Federal Reserve rate hike this year while raising the prospect of a BoC hike if energy prices remain elevated. Canada’s economy is estimated to have expanded at an annualized 3.4% in the second quarter, well above the Bank of Canada’s 2.5% forecast.
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