USD/CAD Forecast: Pair Holds 1.3923 as Traders Weigh Tariffs, Oil, and GDP

USD/CAD is trading near 1.3923 in the European session with traders cautious as several macro factors weigh on sentiment.

Written by: Arslan Butt • Tuesday, September 30, 2025 • 1 min read

• Last updated: Tuesday, September 30, 2025

Quick overview

USD/CAD is trading near 1.3923 as traders remain cautious due to macroeconomic factors, including the risk of a US government shutdown.
Former President Trump has threatened significant tariffs on various imports, raising inflation concerns and boosting demand for the US Dollar.
Canada's economic data is mixed, with flat growth in August and revised GDP figures, while falling oil prices are negatively impacting the CAD.
Technically, USD/CAD shows short-term bullish momentum with key support at 1.3919 and resistance at 1.3957.

USD/CAD is trading near 1.3923 in the European session with traders cautious as several macro factors weigh on sentiment. The US government shutdown risk is front and center with labor data releases (Nonfarm Payrolls and ISM PMI) potentially delayed if Congress can’t pass a funding bill.

Former President Donald Trump escalated trade tensions by threatening tariffs including 100% on patented pharmaceutical imports, 50% on cabinets and vanities and 25% on trucks. This has inflation and supply chain stress fears and is boosting safe-haven demand for the US Dollar.

Canada’s Mixed Data and Oil Weakness

Canada’s data was mixed. Statistics Canada revised July GDP to 0.2% but reported flat growth in August. So resilience but not much momentum. The data provided some support for the CAD but broader global factors are the key.

Meanwhile oil prices weighed on the CAD as prices fell over 3% after Iraq’s Kurdistan region restarted exports of nearly 190,000 barrels per day to Turkey. The additional supply is raising oversupply fears and is weighing on commodity linked currencies.

USD/CAD Forecast: Trendline is Key

USD/CAD Price Chart - Source: Tradingview — USD/CAD Price Chart – Source: Tradingview

Technically USD/CAD is trading near 1.3923 above the 50-SMA at 1.3919 and trendline support so short term momentum is intact. Resistance is at 1.3957 with higher targets at 1.3976 and 1.3997 if bulls push through. Below 1.3919 exposes 1.3884 and the 100-SMA at 1.3852. RSI is 53 so momentum is balanced.

Price action is consolidating after last week’s rally with buyers defending 1.3919-1.3907. If that zone fails then focus will be back on 1.3861. For now USD/CAD is cautiously bullish with trendline support and safe-haven flows.

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ABOUT THE AUTHOR See More

Arslan Butt

Lead Markets Analyst – Multi-Asset (FX, Commodities, Crypto)

Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics. His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker. His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.