USD/CAD Reaches Four Consecutive Bullish Sessions Amid Aggressive Fed Expectations

The Canadian dollar continues to face challenges as the USD/CAD exchange rate records four consecutive bullish sessions, accumulating gains of over 1.00% in favor of the U.S. dollar.

This strength is partly due to growing expectations that the Federal Reserve could adopt a more aggressive stance, increasing demand for U.S. dollars and putting pressure on the Canadian currency.

The recent inflation data release has shifted market expectations, with over 90% chance of an interest rate hike from the current 3.75% level to 4.00%, according to CMEGROUP.

This change in monetary policy expectations is driving demand for U.S. dollars higher and could continue influencing the strength of the currency in the near term.