The Canadian Dollar (CAD) is little changed on the USD on the day, with spot holding close to Monday’s close in the low 1.35 zone, Scotiabank’s Chief FX Strategist Shaun Osborne notes.

CAD holds near fair value on wider US/Can spreads

“The CAD’s push to the low 1.34 area last week has steadily reversed after yield spreads widened in the USD’s favour. The CAD remains generally range bound between the low/mid 1.34s and the mid-1.36s at the moment. Spot is trading close to its fair value estimate (1.3546) today.”

“Steady USD gains from last week’s low have recovered about half of the last September drop in USDCAD from the 1.3647 peak. Momentum is leaning USD-bullish but looks relatively weak. More USD gains may be possible in the near-term through the upper 1.35 area but the broader, sideways range trade in spot below 1.3650 is likely to remain intact for now.”