The gap is the US Treasury two-year yield minus the Government of Canada two-year yield, and daily USD/CAD changes have moved with it over the quarter. Both two-year yields sit well above their central bank policy rates, so the difference between them reflects relative rate expectations after the Federal Reserve's September 16 hike. A dashed line marks the June 30 exchange rate, which shows how far the currency has moved from where the quarter began.
This chart is presented for general informational purposes only and does not constitute financial, investment, tax, or legal advice. Figures reflect the source and period indicated and may no longer be current.
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The index fell for the month even though Brent crude gained and the Strait of Hormuz stayed shut, because rising United States bond yields outweighed oil and gold.
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The slide in the Canadian dollar began after the Federal Reserve's mid-September rate increase and continued through nearly every session that followed.
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