April 14, 2025
USDCAD: open 1.3857, overnight range 1.3850-1.3916, close 1.3877
Canadian inflation cooled more than expected in March, paving the way for the Bank of Canada to cut interest rates by 25 bps tomorrow. The key metric, Bank of Canada Core CPI rose just 2.2% compared to 2.7% previously.
And that rate cut took on more urgency today. President Trump’s war on the global economy appears to have chased Honda out of Canada. The Japanese auto manufacturer employs 4,200 “associates” at its Alliston, Ontario plant and about 21,000 ancillary jobs.
90% of those jobs are at risk after Honda kowtowed to the US. American euphoria over the job windfall will be curtailed somewhat by the 30% increase in prices as they no longer will benefit from the lower Canadian dollar.
WTI oil traded in a 60.96-62.06 range overnight. The ongoing risk of oversupply stemming from production increases and a global economic slowdown from US tariffs suggests limited upside.
USDCAD Technicals
The intraday USDCAD technicals are mildly bullish after prices failed to break support in the 1.3830 area and then broke above the steep downtrend line from April 8. A decisive break above the 1.3915-20 area will extend gains to 1.4015.
The longer term technicals are unchanged. The break below the 200-day moving average at 1.4000 and the 1.3950 level (61.8% Fibonacci retracement of the September–February range) will continue to guide prices lower. A sustained break above 1.4000 is needed to negate the downside risk.
For today, USDCAD support is at 1.3830 and 1.3770. Resistance is at 1.3920 and 1.3950.
Today’s Range: 1.3820-1.3920
Chart: USDCAD 1 day
FX at a Glance
Gentlemen, Start your Engines.
Global risk sentiment improved after Trump said, “I’m looking at something to help car companies with it. They’re switching to parts that were made in Canada, Mexico and other places, and they need a little bit of time, because they’re going to make them here.” That comment was the green flag for equity traders, and it was off to the races. However, when he mused about the possibility of pharmaceutical and semiconductor tariffs, Wall Street gave back some gains but still closed in positive territory.
Asian equity markets also closed higher, led by a 1.00% rise in Japan’s Topix. The Hong Kong Hang Seng Index gained 0.23% while Australia’s ASX 200 finished up 0.17%. European bourses are rather perky. The German DAX has risen 1.52% and the UK FTSE climbed 0.97%. S&P 500 futures traders are more cautious, and that index is only up 0.11%.
EURUSD
NY Open: 1.1336, Overnight Range: 1.1316-1.1379
EURUSD is consolidating recent gains and is trading with a bid. Prices are underpinned by the US tariff onslaught which risks driving America into a recession. The German ZEW Economic Sentiment Index fell sharply to -14, but traders mostly ignored the news because a big drop was expected, and some responses were collected before Trump’s tariff reversal. The interday technicals are bullish while prices are above 1.1300.
GBPUSD
NY Open: 1.3236, Overnight Range: 1.3165-1.3247
GBPUSD blew through resistance at 1.3200 and accelerated higher after a steady UK employment report. The bigger catalyst for the rally are comments by US Vice President JD Vance stating that there is a “good chance” for a UK/US trade deal because Trump is a Royal fan and he has business interest in the country. UK Retail Sales data is due tomorrow.
USDJPY
NY Open: 142.94, Overnight Range: 142.69–143.59
USDJPY bounced around inside yesterday’s range. Prices are supported by improved risk sentiment on talk of an auto-tariff pause and the move lower in the US 10-year yield. Japanese officials are in the US and hoping to secure a trade deal.
AUDUSD
NY Open: 0.6345, Overnight Range: 0.6316-0.6378
AUDUSD squeezed out additional gains after risk sentiment improved when Trump mused about hitting the pause button for auto tariffs. The RBA minutes did not offer much insight into future interest rate moves but still managed to leave a May rate cut as a possibility.
NZDUSD
NY Open: 0.5910, Overnight Range: 0.5861-0.5928
NZDUSD rallied on the back of broad US dollar weakness and made a fresh 2025 high in the process.
USDMXN
NY Open: 20.0547, Overnight Range: 20.0537-20.1070
USDMXN dropped due to the prospect of auto-tariff relief and broad-based US dollar weakness. However, the outlook for additional Banxico rate cuts and a weak economy suggests that USDMXN downside is limited.
Chart: USDMXN 4 hour
China Snapshot`
PBoC fix: 7.2096 vs exp. 7.3094 (Prev. 7.2110).
Shanghai Shenzhen 300 rose 0.06% to 3761.23
UBS downgraded China’s economic growth to 3.4% in 2025, down from 4.0% previously, with Trump’s tariffs blamed for the move.
Bloomberg reported: China orders its airlines to not take any further delivery of jets from Boeing and to halt any purchases of air-craft related equipment and parts from the US
FX high, low, open (as of 6:00 am ET)
Sources: Yahoo Finance, Oanda, Investing.com, Bloomberg.
