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18.09.202612:49 Analisis Forex & Kajian: USD/CAD. Price Analysis. Forecast. Recent Oil Gains Won't Rescue the Canadian Dollar

Relevance up to 08:00 2026-09-19 UTC+00

Exchange Rates 18.09.2026 analysis

On Friday, USD/CAD trades in a narrow range, remaining below the psychologically important 1.4000 mark — a high touched this week — but spot quotes continue to edge higher, supported by favorable fundamental drivers for the greenback.

The Canadian dollar is showing relative weakness against the US dollar, driven by a widening interest-rate differential that continues to favor USD/CAD. In early September, the Bank of Canada left its policy rate at 2.25%. By contrast, on Wednesday the US Federal Reserve raised its policy rate by 25 bps for the first time in more than three years to a 3.75–4.00% range.

The rate gap puts pressure on the loonie, making it vulnerable to the growing spread between Fed and BoC rates. The widening gap is a primary driver of the Canadian dollar's weakness: the key rate differential has returned to about 175 basis points, which largely explains the pair's uptrend.

Scotiabank strategists' fair-value model points to an equilibrium near 1.3894, implying the US dollar may be somewhat overvalued at current levels. However, given no prospect of a rapid narrowing of the policy gap, a near-term recovery in the loonie looks unlikely.

Persisting trade tensions between the US and Canada are another headwind for the Canadian dollar, which is closely tied to commodity prices. The imposition of high tariffs (up to 50%) on Canadian goods by the US — covering roughly $20 billion of trade — and Canada's retaliatory measures negate some of the positive impact from recent oil gains and further exacerbate pressure on the loonie.

Exchange Rates 18.09.2026 analysis

At the same time, Fed Chair Kevin Warsh's emphasis on inflation has helped temper the recent sell-off in the bond market, bringing US government yields down from multi-year highs. That creates an additional headwind for further US dollar gains and could restrain further upside in USD/CAD. However, the Fed's hawkish stance — implying the possibility of additional rate increases this year — combined with geopolitical uncertainty continues to support the dollar as a safe-haven asset, which benefits USD/CAD bulls.

Technically, USD/CAD retains a bullish bias in the short term after breaking the key zone around 1.3945 at the time of the Fed meeting, where the 100-day SMA and the 50-day SMA intersect. Bulls are now targeting a break-and-hold above the round 1.4000 level.

On the downside, the formerly broken resistance at 1.3945 now appears to act as the nearest support. More significant support levels lie near the round 1.3900 level and just below it. Oscillators are mixed, while the RSI is positive, indicating bulls are gaining strength.

* Analisis pasaran yang disiarkan di sini adalah bertujuan untuk meningkatkan kesedaran anda, tetapi tidak untuk memberi arahan untuk membuat perdagangan.

Irina Yanina,
Analytical expert of InstaSpot
© 2007-2026
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