Canadian Dollar Hits 7-week High

The Canadian dollar strengthened sharply to 1.39 per USD in November, reaching a more than two-month high as the greenback retreated broadly following Democratic victories in the US midterm elections. The results prompted investors to reassess the outlook for US growth amid tighter scrutiny of AI investment and potential opposition to data-centre development. The loonie also gained on hopes of easing trade tensions between Canada and the US, as a Democratic majority could constrain some of President Trump’s trade policy decisions. The dispute began in February 2025, when Trump announced broad tariffs on Canadian goods, prompting retaliatory measures from Ottawa. While USMCA-compliant goods were later exempted, additional tariffs remained on steel, aluminum and automotive imports. Meanwhile, Canada posted a C$5.4 billion trade surplus in September, its largest since May 2022 and above expectations of C$4.1 billion.

The Canadian Dollar touched 1.39 against the USD, the highest since September 2026. Over the past 4 weeks, US Dollar Canadian Dollar lost 2.22%, and in the last 12 months, it decreased 1.17%.

The S&P/TSX Composite Index traded near flat around 36,000 on Wednesday after the Bank of Canada’s policy decision to hike interest rates to by 25 bps to 2.5%, as expected. The bank said the decision aims to reduce the risk that continuing high energy prices spread broadly to the prices of other goods and services while noting that here could be a need to increase the policy rate further. Meanwhile, the US Fed is expected to hold rates steady. Financial stocks were mostly subdued. Agnico Eagle fell 1%, Alamos lost 0.5%, and Kinross dropped 2%, while First Quantum was flat. Teck Resources rose 3.5% ahead of Thursday’s earnings, while Imperial Oil gained 1% and Cameco added 0.2% ahead of Friday’s results. Tamarack Valley climbed 2% after raising its 2026 production forecast, while Trican Well Service surged 6% on higher Q3 profit.