CAD Range Trade Continues with Upside Bias Against USD: Scotiabank

According to Scotiabank strategists Shaun Osborne and Eric Theoret, the Canadian Dollar (CAD) is currently in a tight sideways range near 1.38 against the US Dollar (USD), with no domestic data driving its movement.

The CAD's fair value model indicates a stronger CAD around 1.3700, which is the largest valuation gap in close to a month.

Osborne and Theoret note that the CAD has reverted to being driven by external factors and technicals, with no domestic data to focus on this week.

The strategists also mention that strengthening crude prices are providing some additional lift to Canadian terms of trade, but this is not fully reflected in the current CAD value.