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Today's Forex News

USDCAD: Sideways Movement

USDCAD chart on H4 shows a flat with a false breakdown of the upper boundary and a return to the expanding wedge and a bounce from MA200. Growing ATR indicates the growth of volatility and increasing probability of strong movement when key levels are broken.Action Forex2025-01-21

USD/CAD retreats from multi-year top, hovers around mid-1.4400s as focus shifts to Canadian CPI

The USD/CAD pair trims a part of strong intraday gains to the highest level since March 2020 and trades around the 1.4440-1.4435 area during the early European session on Tuesday, still up 0.90% for the day. FX Street2025-01-21

EUR/CAD gives up significant intraday gains ahead of Canadian inflation data

The EUR/CAD pair surrenders a majority of its intraday gains after failing to extend its four-day run-up above the key resistance of 1.5050 in Tuesday's European session. However, the outlook of the asset remains firm as the Canadian economy is expected to face hefty tariff hikes from the United States (US).FX Street2025-01-21

EURCAD Price Action Breakdown

The EURUSD pair remains weak, with key support levels at 1.0176 and the significant parity level at 1.0000. On the upside, resistance is at 1.0436 and 1.0486, while the broader downtrend will likely continue unless the pair breaks above 1.0775.Action Forex2025-01-21

CAD/JPY Technical: Trump's Shock and Awe Trade Policy Manoeuvre Erased CAD Gains

The global markets had a moment of “joy and reprieve” during Monday, 20 January US session when Trump's inauguration speech adopted a milder tone on trade tariffs targeted on US major trading partners, avoided any mention of the quantum amount on tariffs, and instead mentioned studies will be conducted on China, Canada, and Mexico to assess any form of unfair trade practices.Action Forex2025-01-21

CADJPY Price Action Breakdown

The USDJPY pair fluctuated around the 156.15-156.20 level on Monday. The pair recently bounced off the lower boundary of a long-term upward channel but faced resistance near 156.55-156.60.Action Forex2025-01-21

Additional News:

U.S. Dollar Retreats From Session Highs: Analysis For EUR/USD, GBP/USD, USD/CAD, USD/JPY

Falling Treasury yields put additional pressure on the American currency.FXEmpire2025-01-21

USD/CAD sees more upside as soft Canadian CPI boosts BoC large rate cut bets

The USD/CAD pair witnesses buying interest near 1.4430 in Tuesday's North American session as Statistics Canada reported that soft inflation data for December. The agency showed that the headline inflation rose at a slower pace of 1.8%, compared to estimates and the former release of 1.9% on year.FX Street2025-01-21

Pound Canadian Dollar (GBP/CAD) Exchange Rate Firms as Trump Confirms Mexico/Canada Tariffs

The Pound to Canadian Dollar (GBP/CAD) exchange rate rallied on Tuesday, after Donald Trump's tariff threats rattled CAD investors The Canadian Dollar (CAD) came under pressure on Tuesday as Trump outlined his plans to impose 25% tariffs on Canada from the start of February. This reversed CAD's gains from Monday, following reports.ExchangeRates2025-01-21

Japanese yen forecast: USD/JPY and CAD/JPY in focus ahead of BoJ

The narrowing interest rate differentials between Japan and the rest of the world has been a key theme in the improving Japanese yen forecast in the last couple of weeks. The main USD/JPY pair dropped to fresh five-week lows on Tuesday, before bouncing back to trade in the green at the time of writing, while yen pairs such as the CAD/JPY, which have been falling even more sharply because of Trump's plans to impose tariffs on Canada's exports to the US, remained in the red.Forexcom2025-01-21

Loonie Weakness Persists in Calmer Markets, AUD/CAD Challenges Key Resistance

Forex markets have settled into quieter trading as the immediate impact of US President Donald Trump's inauguration and initial executive orders fades. While Trump's proposed tariffs remain a significant concern, their delayed implementation suggests a more calculated and strategic approach, tied to future negotiations.Action Forex2025-01-21

USD/CAD holds positive ground near 1.4350 as Trump vows Canada tariffs

USD/CAD holds positive ground near 1.4350 as Trump vows Canada tariffsFX Street2025-01-21

The Canadian Dollar: A Historical Journey

The Canadian dollar, symbolized as CAD or C$, is the official currency of Canada. Its history is a fascinating tale of economic development, political decisions, and global influences. The journey of the Canadian dollar reflects the growth and evolution of Canada as a nation.

Early Currency in Canada

Before the introduction of the Canadian dollar, the region had a diverse array of currencies in circulation. French colonists used French coins, British colonists used British pounds, and Spanish dollars were also widely circulated. In addition, indigenous peoples used wampum, a form of currency made from shell beads.

In the early 19th century, the British pound was the official currency of British North America. However, the Spanish dollar was the most widely used currency in everyday transactions due to its wide circulation in the Americas.

The Birth of the Canadian Dollar

The idea of a unified currency for Canada was first proposed in the 1840s. The Province of Canada, consisting of modern-day Ontario and Quebec, passed the Currency Act in 1841, which aimed to replace the diverse currencies in circulation with a single, unified currency.

The Canadian dollar was officially introduced in 1858, replacing the British pound. The new currency was based on the decimal system, making it easier to calculate than the pound system. The Canadian dollar was pegged to the US dollar at par, reflecting the close economic ties between the two countries.

The Gold Standard and the Bank of Canada

Like many countries, Canada adopted the gold standard in the 19th century. The Canadian dollar was pegged to a fixed amount of gold. However, the gold standard was abandoned during World War I due to the financial pressures of the war.

The Bank of Canada was established in 1934 as the country's central bank. One of its main roles was to manage the country's money supply and ensure the stability of the Canadian dollar. The Bank of Canada began issuing banknotes in 1935, replacing the notes issued by private banks.

The Bretton Woods System and the Floating Dollar

After World War II, Canada became a part of the Bretton Woods system, an international monetary system that pegged currencies to the US dollar, which was in turn pegged to gold. However, Canada was the first country to break from this system in 1950, choosing to let its currency float freely against other currencies.

The Canadian dollar has been a floating currency since then, with its value determined by the foreign exchange market. The value of the Canadian dollar has fluctuated over the years, influenced by factors such as oil prices, interest rates, and economic conditions.

The Loonie and the Toonie

The Canadian one-dollar coin, known as the Loonie, was introduced in 1987. The coin got its nickname from the image of a loon, a bird common in Canada, on its reverse side. The introduction of the Loonie was part of a move towards using coins for lower denominations, which are more durable and cost-effective than paper notes.

The two-dollar coin, known as the Toonie, was introduced in 1996. The Toonie features a polar bear on its reverse side, another iconic symbol of Canada.

Conclusion

The history of the Canadian dollar is a reflection of Canada's economic development and its place in the global economy. From the diverse currencies of the colonial period to the modern Loonie and Toonie, the Canadian dollar has evolved alongside the nation it serves. As Canada continues to navigate the global economic landscape, the journey of the Canadian dollar is sure to continue.

The United States Dollar: A Historical Perspective

The United States dollar, symbolized as $ and often referred to as the greenback, has a rich and storied history that is intertwined with the development and growth of the United States itself. The dollar is not just a piece of paper or a number in a bank account; it is a symbol of the economic power and global influence of the United States.

Colonial Beginnings

The history of the U.S. dollar can be traced back to the early colonial period. The colonies, lacking a standard form of currency, used a variety of mediums for trade, including wampum, tobacco, and foreign coins. The British government, however, prohibited the colonies from minting their own coins, leading to a chronic shortage of currency.

In response to this shortage, the Massachusetts Bay Colony issued the first paper money in the colonies in 1690. Other colonies soon followed suit. These early forms of paper money were essentially promissory notes or bills of credit. They were not backed by gold or silver but were instead backed by the promise of future tax revenues.

The Birth of the Dollar

The U.S. dollar as we know it today was first proposed by Robert Morris, a Pennsylvania financier who was appointed as Superintendent of Finance in 1781. Morris proposed the creation of a national currency, with the dollar as its basic unit. His proposal was based on the Spanish milled dollar, a silver coin that was widely used in the colonies.

The U.S. dollar was officially adopted by the Congress of the Confederation with the passage of the Coinage Act of 1792. This act established the U.S. Mint and defined the dollar in terms of silver: a dollar was to contain 371.25 grains of pure silver. The act also established a gold-to-silver ratio of 15:1, meaning that one ounce of gold was worth 15 ounces of silver.

The Gold Standard

The U.S. remained on a bimetallic standard until 1873, when the Fourth Coinage Act was passed. This act, also known as the Gold Standard Act, effectively put the U.S. on a de facto gold standard by eliminating silver as a standard of value. The act was controversial and led to the so-called "Free Silver" movement, which advocated for the free coinage of silver.

The U.S. officially adopted the gold standard with the passage of the Gold Standard Act of 1900. This act defined the dollar in terms of gold: a dollar was equivalent to 23.22 grains of gold, or roughly 1/20th of an ounce.

The Federal Reserve and Fiat Currency

The creation of the Federal Reserve in 1913 marked a significant shift in U.S. monetary policy. The Federal Reserve was given the power to issue Federal Reserve Notes, which became the only type of paper money issued in the U.S.

The U.S. abandoned the gold standard during the Great Depression. In 1933, President Franklin D. Roosevelt issued an executive order prohibiting the private ownership of gold. The Gold Reserve Act of 1934 confirmed this policy and devalued the dollar to 1/35th of an ounce of gold.

The final break with gold came in 1971, when President Richard Nixon ended the convertibility of the dollar into gold. This marked the beginning of the era of fiat money, in which the dollar is not backed by any physical commodity but is instead backed by the full faith and credit of the U.S. government.

The Dollar in the Global Economy

After World War II, the Bretton Woods agreement established the U.S. dollar as the world's reserve currency. Under this system, other countries pegged their currencies to the dollar, whichwas in turn pegged to gold. This system lasted until 1971, when the U.S. abandoned the gold standard.

Since then, the U.S. dollar has remained the dominant global reserve currency, despite occasional challenges. The dollar's status as the world's reserve currency gives the U.S. significant economic advantages, including the ability to borrow at lower costs and to have significant influence over global economic affairs.

The Digital Age

In the digital age, the U.S. dollar has evolved once again. Today, most dollars exist not as physical currency but as digital entries in electronic accounts. The rise of digital payment systems, online banking, and cryptocurrencies represent new frontiers for the U.S. dollar.

Conclusion

The history of the U.S. dollar is a testament to the economic development and global influence of the United States. From its colonial beginnings to its current status as the world's dominant reserve currency, the dollar has been a central player in global economic affairs. As we move further into the digital age, the dollar will undoubtedly continue to evolve, reflecting the changing nature of money and value in our society.