USD/CAD is consolidating above 1.4200, near its highest level since April 2025, as traders hold fire before the June US Nonfarm Payrolls report. A dovish Bank of Canada and a fresh slide in Crude Oil keep the Canadian Dollar under pressure, while a firm US Dollar and lingering geopolitical risk favour further gains.
The USD/CAD pair consolidates above the 1.4200 mark during Thursday’s Asian session as traders wait for the crucial US monthly employment print before positioning for further gains. Spot prices sit close to the highest level since April 2025, held up by a mix of supporting factors.
Oil and a dovish BoC weigh on the Loonie
Crude Oil has dropped to a fresh low since late February as the resumption of shipping through the Strait of Hormuz eased fears of a prolonged supply shock. The Bank of Canada, meanwhile, has kept a dovish stance, with policymakers prioritising a sluggish economy over inflation threats. Both factors keep undermining the commodity-linked Canadian Dollar, and a bullish US Dollar adds to the tailwind for the pair.
The US ADP report on Wednesday showed private-sector employment rose by 98K in June, down from the previous month’s unrevised 122K and missing estimates for 113K. The ISM Manufacturing PMI eased to 53.3 in June from 54 the month before. The data, however, does little to temper Federal Reserve rate-hike bets, and geopolitical risks continue to support the US Dollar.
Geopolitics keeps the USD bid
Iran and the US concluded a round of indirect talks in Qatar with no sign of headway toward a lasting peace agreement over the Strait of Hormuz. Separately, Russia launched missiles and drones on Ukraine’s capital, Kyiv, early Thursday. This keeps geopolitical risk in play and favours USD bulls, while divergent BoC-Fed policy expectations suggest the path of least resistance stays to the upside.
Traders wait for the jobs print
A separate FXStreet forecast puts the pair trading flat around 1.4210 in European trade, sideways for over a week. The US economy is estimated to have created 110K fresh jobs in June, lower than 172K in May, with the Unemployment Rate seen steady at 4.3%. Fed Chairman Kevin Warsh warned on Wednesday that inflation remains too high.
On the charts, the pair holds a bullish bias while spot stays above the 20-day exponential moving average at 1.4103. The Relative Strength Index at 77.7 signals overbought conditions, and a break of the 1.4169-1.4248 consolidation could open the way toward the 1 April 2025 high at 1.4415.
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