USD/CAD – Live and Historical Rates
The US Dollar and the Canadian Dollar are two closely correlated currencies. While the USD is a major, the CAD is not. The pair that the two make is not a major pair, but it is a commodity one. The chart above shows the amount of CAD required to purchase a USD.
The US dollar is currently the world’s top reserve currency and the most traded currency as well. It is directly linked to some of the world’s top commodities too, like oil and gold. The popularity of the USD as a reserve option is best described by the fact that while it is the USA’s national currency, more of it is held outside the country than is circulating within. The USD was one of the first floating currencies. The financial authority controlling it is the Federal Reserve, which does tweak interest rates every now and then, to keep the greenback in-line.
To understand how closely the CAD is correlated with the USD, one has to understand the depths of the trading connection between the two neighbors. Some 85% of Canada’s exports head to the US, while the Canucks get about 50% of their imports from their southern neighbor too. No wonder that at one point, simply incorporating the CAD into the USD was seriously considered. Canada’s exports include oil and timber, though it has to be pointed out that the biggest factor influencing the value of the CAD is the price of oil.
As said above, the USD/CAD pair is a commodity pair. With that in mind, it’s easy to see how the biggest trading opportunities on the pair stem from the oil price fluctuations. Other profit opportunities arise from interest rate-related announcements from the Fed. Carry trading is not normally profitable on the pair.
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