The exchange rate for CAD to TWD has recently shown instability and mixed sentiments, influenced by a combination of domestic economic indicators, central bank policies, and external market pressures.
Currently, the CAD is trading at 14-day lows near 21.85 TWD, a figure that is just 0.8% above its three-month average of 21.68. The CAD has remained within a relatively stable range of 21.23 to 22.31 over the past months, indicating limited volatility despite the mixed economic signals. However, bearish sentiment on the CAD has surged to a five-month high, with increasing short positions observed in the futures market. Analysts attribute this trend to recent disappointing employment data and heightened expectations for interest rate cuts by the Bank of Canada.
The recent uptick in oil prices, with crude trading at approximately $67.95 per barrel, has had a limited positive effect on the CAD, as it is still trending below its three-month average of $68.63. Oil prices, being a vital factor for the CAD due to Canada’s status as a major oil exporter, suggest some level of correlation, but the CAD is also pressured by broader market dynamics, particularly a stronger U.S. dollar in recent trading sessions.
On the TWD front, recent developments indicate the Taiwanese central bank’s efforts to manage the currency's appreciation, which has seen significant gains this year. Measures to enforce capital controls to mitigate the TWD's sharp rise reflect ongoing concerns about Taiwan's export competitiveness amid international economic pressures, including U.S. tariffs. This regulatory environment can influence the TWD's valuation against the CAD, particularly as trade balances and investor perceptions adapt to shifting economic narratives.
Overall, analysts express a cautiously optimistic outlook for the CAD against the backdrop of anticipated interest rate cuts by the BoC, which are expected to stabilize the currency in the medium term. For TWD, the focus remains on domestic financial stability measures and the impacts of international trade relations, which collectively will continue to shape the CAD to TWD exchange rate going forward.
