Daily Foreign Exchange Update For June 1, 2026

Spot Rates * USDCAD: 1.3840 - 1.3845 (as at 8:50am PST) * Asia: 1.3797 to 1.3820 * Europe: 1.3812 to 1.3849 * North America: 1.3827 to 1.3849

Technical Support / Resistance * S2 1.3700 * S1 1.3770 * R1 1.3870 * R2 1.3900

Key Economic Data Releases: - Canada S&P global mfg PMI: 52.9 prev 53.30 - U.S. ISM mfg PMI: 55.1 exp 55.3 prev 55.3

Important events we're watching this week: * June 2, USA, JOLTS job openings * June 3, USA, ADP employment change, ISM services PMI * June 4, USA, Challenger job cuts * June 5, Canada, Net change in employment * June 5, USA, Non-farm payrolls

Market Spotlight

The CAD is facing notable headwinds following unexpected data showing that Canada’s economy has entered a technical recession. With first-quarter real GDP contracting and previous growth figures revised downward, market optimism for a swift economic recovery has faded. This economic setback, paired with growing labor market slack, has led major financial institutions to heavily challenge aggressive interest-rate hike expectations from the Bank of Canada, clouding the near-term outlook for the local currency.

Analysts at Commerzbank point out that Canada's latest growth figures have definitively cast doubt on a near-term economic turnaround. Because of these underlying domestic struggles and a softening labor market, they argue that further monetary tightening is highly unlikely until late in the year at the earliest, suggesting that any future strength against the US Dollar will depend entirely on external factors.

Strategy experts at Brown Brothers Harriman highlight that the combination of falling crude Oil prices and the surprise contraction in Q1 GDP has heavily weighed on sentiment surrounding the Canadian currency. They believe current market pricing for upcoming BoC rate hikes is far too aggressive, creating a scenario where the USD/CAD exchange rate could surge toward major technical resistance as market expectations adjust to reality. Based on the insights from both institutions, the banks collectively hold a bearish near-term outlook for the CAD’s next market movements, predicting it will struggle to find independent upward momentum.

Commerzbank emphasizes that the CAD lacks the intrinsic economic backing to drive the USD/CAD pair lower on its own merits, leaving it dependent on USD weakness. Meanwhile, Brown Brothers Harriman forecasts a direct upward risk for the USD/CAD cross, explicitly predicting a potential overshoot toward the 1.3930 level as the market unwinds its aggressive rate hike bets.

• Currently, the TSX is down 0.48% while the DJIA is down 0.15%. * EURCAD is up 0.01% trading between 1.6058 and 1.6120. * GBPCAD is up 0.26% trading between 1.8538 and 1.8635. * JPYCAD is up 0.57% trading between 0.00854 and 0.00867. * Gold is down 1.45% trading between $4,447 - $4,545USD/oz. * Silver is down 0.42% trading between $72.36 - $76.27USD/oz. * Oil (WTI crude) is up 6.73% trading between $89.11 and $94.70.