The Canadian Dollar (CAD) is a mild underperformer this morning alongside its commodity cousins (AUD and NZD) which are also booking minor losses on the US Dollar (USD) on the session, Scotiabank’s FX analyst Shaun Osborne notes.

Is set to reach the 1.39+ area

“Commodity FX is ignoring firmer stocks while the high beta currencies may be reflecting some spillover from a weaker CNY/CNH after the PBoC surprised markets with a cut in the 1W reverse repo rate, the first reduction in a year. The CAD’s focus this week falls squarely on Wednesday’s BoC policy decision where a 25bps cut is more or less fully priced in at this point.”

“The CAD’s slide after failing to crack 1.36 earlier this month has been relentless, with the CAD managing only one positive session in the last eight trading days. USD gains remain capped in the mid-1.37s for now but a break above 1.3750 would suggest additional gains to the 1.38 area in the short run and could c. Support is 1.3650/75.”