CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 77% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Create Account
☰
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 77% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Create Account
✖

Canadian Dollar Forecast: USD/CAD Drops as BoC Holds Interest Rate

Article By: ,  Strategist
April 16, 2025 9:25 PM

Canadian Dollar Outlook: USD/CAD

USD/CAD drops towards the monthly low (1.3829) as the Bank of Canada (BoC) keeps its benchmark interest rate at 2.75%, and the exchange rate stage further attempts to test the to test the November low (1.3821) as struggles to retain the advance from the start of the week.

Canadian Dollar Forecast: USD/CAD Drops as BoC Holds Interest Rate

The recent rebound in USD/CAD may turn out to be temporary as the exchange rate trades below the 200-Day SMA (1.4003) for the first time since October, and it seems as though the BoC is at or nearing the end of its rate-cutting cycle as the ‘Governing Council will continue to assess the timing and strength of both the downward pressures on inflation from a weaker economy and the upward pressures on inflation from higher costs.’

Join David Song for the Weekly Fundamental Market Outlook webinar.

David provides a market overview and takes questions in real-time. Register Here

 

In turn, the BoC may stick to the sidelines as ‘monetary policy cannot resolve trade uncertainty or offset the impacts of a trade war,’ and the weakness in USD/CAD may persist ahead of Canada’s federal election on April 28 as Governor Tiff Macklem and Co. endorse a wait-and-see approach.

With that said, USD/CAD may continue to trade to fresh yearly lows as it no longer trades within the February range, but the exchange rate may consolidate over the remainder of the week should it defend the monthly low (1.3829).

USD/CAD Price Chart – Daily

Chart Prepared by David Song, Senior Strategist; USD/CAD Price on TradingView

  • USD/CAD appears to be stuck in a narrow range following the failed attempts to close below 1.3850 (50% Fibonacci extension), and the exchange rate may continue to consolidate as it struggles to push above the 1.3940 (61.8% Fibonacci retracement) to 1.4000 (61.8% Fibonacci extension) zone.
  • Nevertheless, a close below 1.3850 (50% Fibonacci extension) may lead to a test of the November low (1.3821), with the next area of interest coming in around 1.3700 (38.2% Fibonacci extension) to 1.3710 (78,6% Fibonacci retracement).
  • At the same time, a break/close above the 1.3940 (61.8% Fibonacci retracement) to 1.4000 (61.8% Fibonacci extension) zone may push USD/CAD towards 1.4110 (50% Fibonacci retracement), with the next area of interest coming in around 1.4210 (78.6% Fibonacci extension) to 1.4270 (38.2% Fibonacci retracement).

Additional Market Outlooks

US Dollar Forecast: USD/CHF Weakness Keeps RSI in Oversold Territory

GBP/USD Stages Six-Day Rally for First Time in 2025

USD/JPY Defends Monthly Low to Keep RSI Above 30 for Now

Euro Forecast: EUR/USD Clears 2024 High to Push RSI into Overbought Zone

--- Written by David Song, Senior Strategist

Follow on Twitter at @DavidJSong

StoneX Europe Ltd may make third party material available on this website which may contain information included but not limited to the conditions of financial markets. The material is for information purposes only and does not contain, and should not be construed as containing, investment advice and/or investment recommendation and/or an investment research and/or an offer of or solicitation for any transactions in financial instruments; any decision to enter into a specific transaction shall be made by the client following an assessment by him/her of their situation.

StoneX Europe Ltd makes no representation or warranty and assumes no liability as to the accuracy or completeness of the information provided, nor any loss arising from any investment based on a recommendation, forecast or other information supplied. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. We are not under any obligation to update any such material. Any opinion made may be personal to the author and may not reflect the opinion of StoneX Europe Ltd.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 67.6% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Please ensure you fully understand the risks involved by reading our full risk warning.

FOREX.com is a trading name of StoneX Europe Limited, and FOREX.com/ie is a domain operated by StoneX Europe Ltd, a member of StoneX Group Inc. StoneX Europe Ltd, is a Cyprus Investment Firm (CIF) company registered to the Department of Registrar of Companies and Official Receiver with a Registration Number HE409708, and authorized and regulated by the Cyprus Securities & Exchange Commission (CySEC) under license number 400/21. StoneX Europe is a Member of the Investor Compensation Fund (ICF) and has its registered address at Nikokreontos 2, 5th Floor, 1066 Nicosia, Cyprus.

FOREX.com is a trademark of StoneX Europe Ltd, a member of StoneX Group Inc.

This website uses cookies to provide you with the very best experience and to know you better. By visiting our website with your browser set to allow cookies, you consent to our use of cookies as described in our Privacy Policy.

Through passporting, StoneX Europe is allowed to provide its services and products on a cross-border basis to the following European Economic Area ("EEA") states: Austria, Bulgaria, Croatia, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Netherlands, Norway, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden.

StoneX Europe Ltd products, services and information are not intended for residents other than the ones stated above.

StoneX Europe Ltd may make third party material available on this website which may contain information included but not limited to the conditions of financial markets. The material is for information purposes only and does not contain, and should not be construed as containing, investment advice and/or investment recommendation and/or an investment research and/or an offer of or solicitation for any transactions in financial instruments; any decision to enter into a specific transaction shall be made by the client following an assessment by him/her of their situation. StoneX Europe Ltd makes no representation or warranty and assumes no liability as to the accuracy or completeness of the information provided, nor any loss arising from any investment based on a recommendation, forecast or other information supplied. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. We are not under any obligation to update any such material. Any opinion made may be personal to the author and may not reflect the opinion of StoneX Europe Ltd.

© FOREX.COM 2025