Canadian dollar hovers near 70 U.S. cents as Canada–U.S. yield gap hits widest since 2025

For households and firms, a near-70-cent dollar shows up in imported equipment, travel budgets and grocery shelves that rely on U.S.-priced inputs. Exporters collecting U.S. dollars get a competitive lift when converting revenues home, but many Canadian manufacturers also buy machinery and components abroad, so the net effect is mixed. Statistics Canada’s latest industry GDP print showed flat July output and only a preliminary 0.2 per cent August rebound, leaving markets cautious that domestic data will soon close the yield gap. October’s calendar is dense: Canada’s labour report on Oct. 9, September CPI on Oct. 19, and Bank of Canada and Federal Reserve decisions on Oct. 28. TD Securities FX strategist Jayati Bharadwaj told BNN Bloomberg she still sees October and December as early for Bank of Canada hikes and expects the loonie to stay under pressure near 70 cents while the Fed leads, with a potential rebound if Ottawa’s central bank starts catching up in early 2027. Market pricing and economist views continue to diverge on whether energy-driven inflation will force an earlier Canadian move. Sources: MarketScreener / Reuters; BNN Bloomberg; Bank of Canada; Hashtag Investing (market wrap).