Canadian Dollar Hits 13-Week Low as Fed Talks Weigh on Loonie

The Canadian Dollar just can’t catch a break — sliding into its weakest level in 13 weeks against the US Dollar, as traders shift focus to the Fed’s next big move.

The Canadian Dollar (CAD) continued to weaken on Thursday, dipping against the Greenback and dragging USD/CAD back into the 1.3900 handle. With no fresh economic data from Canada, the Loonie is left exposed while the US Dollar takes control.

This week, all eyes are on central banks, especially the Federal Reserve. Markets are awaiting Fed Chair Jerome Powell’s appearance at the Jackson Hole Symposium, where investors hope for clarity on whether a September rate cut is still on the table. For now, recent hawkish tones from Fed officials and stronger US data are giving the Dollar the upper hand.

Technically, the Canadian Dollar has been in a three-day losing streak, slipping another 0.25% on Thursday. The USD/CAD pair is now testing the 200-day EMA near 1.3880, opening the door for further gains if momentum continues. However, if Loonie buyers step in, a quick reversal back toward the 50-day EMA at 1.3770 is possible.

With oil prices and Canadian fundamentals offering little support, traders will be watching Powell’s remarks closely. A stronger signal for rate cuts could give the CAD some breathing room — but for now, the Greenback is firmly in control.

? Source: FXStreet