Passive hedge rebalancing flows may be mildly CAD-supportive if anything, but the sharp widening in US/Canada spreads over the second half of the month remains a drag on the CAD’s broader outlook.

The USD retains a clear advantage over the CAD from a broader perspective, with Wednesday’s gains extending the new year run higher in spot marginally. 

A small, inside range (within Wednesday’s range) today does suggest some reluctance to push higher still, however, and a lack of momentum behind the move. 

Resistance is 1.3610/1.3620. Support is 1.3540/1.3550.