CAD strengthens against USD on tighter spreads
The Canadian Dollar is gaining strength against the US Dollar, supported by tighter US-Canada 2-year spreads and firmer commodity FX.
The USD/CAD trades just below the fair value estimate of 1.3895.
A sustained break below 1.39 could lead to a move toward 1.3817 and potentially the 1.35-1.37 range, with the 25bps narrowing in the US/Canada 2Y bond differential since late July underpinning CAD gains.
The NZD, NOK, SEK, and CAD are all near the top of the intraday performance table for G10 FX, despite a mixed risk backdrop.