Daily Foreign Exchange Update for July 21, 2026
July 21, 2026
Yesterday the Trump administration signed proclamations imposing an additional 50% tariff on a range of Canadian goods, including autos, dairy, alcohol, cement, and electrical equipment, citing what it called discriminatory treatment of U.S. exports.
Spot Rates:
- USDCAD spot rate: 1.4090 - 1.4095 (as at 8:00am PST)
- Asia: 1.4070 to 1.4085
- Europe: 1.4050 To 1.4080
- North America: 1.4070 to 1.4095
Technical Support / Resistance:
- S2 1.3950
- S1 1.4000
- R1 1.4100
- R2 1.4125
Key Economic Data Releases:
- ADP Employment Change: 16.5k (prec 19.25k)
Important events we're watching this week:
- July 23, Canada, Retail sales (May)
- July 23, USA, Initial jobless claims
- July 24, USA, S&P global manufacturing / services PMI
Market Spotlight
Yesterday the Trump administration signed proclamations imposing an additional 50% tariff on a range of Canadian goods, including autos, dairy, alcohol, cement, and electrical equipment, citing what it called discriminatory treatment of U.S. exports. The tariffs, issued under a rarely used provision of the Tariff Act of 1930, cover roughly $20 billion in annual trade and are set to take effect in 30 days, excluding energy, potash, and a handful of other categories. This marks a notable escalation in U.S.-Canada trade tensions and is the headline risk for the loonie heading into the next month. The Loonie is on the backfoot again, falling towards 1.4100 against USD this morning, as the currency market continues to weigh the tariff news against other cross-currents, including softer U.S. dollar sentiment tied to hopes for a diplomatic resolution to the U.S.-Iran conflict.
On the domestic side, Canadian inflation data released Monday showed headline CPI cooling to 2.9% year-over-year in June, down from 3.2% in May, which reduces the likelihood of further Bank of Canada rate hikes. The Bank of Canada held its policy rate steady at 2.25% earlier this month and struck a relatively constructive tone, citing improving growth and inflation expected to run somewhat above prior forecasts before gradually easing. Crude oil prices have also provided some underlying support for the loonie, given Canada's status as a major oil exporter, with prices lifted by ongoing tensions in the Middle East. Taken together, the currency is being pulled in multiple directions: trade policy risk on one side, a resilient domestic economic backdrop and firmer oil prices on the other. No doubt trade talk and CUSMA negotiations will determine the Loonie’s short term future.
- Currently, the TSX is up 0.52% and the DJIA is down 0.59%.
- EURCAD is up 0.11% trading between 1.6053 and 1.6081.
- GBPCAD is down 0.25% trading between 1.8814 and 1.8930.
- JPYCAD is down 0.21% trading between 0.00864 and 0.00866.
- Gold is up 1.55% trading between $3,999 - $4,084USD/oz.
- Silver is up 4.56% trading between $56.10 - $59.25USD/oz.
- Oil (WTI crude) is up 3% trading between $81.18 and $84.72