The Canadian dollar is currently trading higher against its major counterparts after Canada posted a trade surplus. The positive trade data indicates a robust economic performance, bolstering confidence in the Canadian economy.

Key Factors Influencing the Canadian Dollar

• Trade Balance: Canada’s trade balance shifted into positive territory, driven by increased exports of commodities and manufactured goods.
• Commodity Prices: Rising oil prices, a key export for Canada, have further supported the Canadian dollar.
• Bank of Canada Policy: Expectations regarding future interest rate hikes by the Bank of Canada are also contributing to the currency’s strength.

Market Reaction

The Canadian dollar’s appreciation has been most pronounced against the US dollar. Investors are closely monitoring upcoming economic data releases for further clues about the direction of the Canadian economy and the Bank of Canada’s monetary policy stance.