The currency pair drops despite Fed rate hike expectations as the US Dollar declines in early Asian trading.
USD/CAD retreated to 1.4230 in Asian trading on Thursday, ending a winning streak that began June 10. The decline follows a broader weakening of the US Dollar, even as markets price in potential Federal Reserve interest rate hikes later this year.
The pair had climbed steadily since early June, supported by a stronger USD and shifting monetary policy expectations. However, recent softening in the greenback has provided relief to the Canadian Dollar, despite lingering hawkish signals from the Fed.
Trading activity in the Asian session suggests a cautious shift in sentiment, though no immediate market reaction has been reported.