The Canadian dollar advanced to roughly 1.36 per USD in June, its strongest in eight months, primarily on broad US dollar weakness driven by softer-than-expected US inflation and a repricing of Fed policy. May’s CPI printed just 2.4% year-on-year, which sent Treasury yields lower and eroded the greenback’s carry appeal. Domestically, the Bank of Canada’s June decision to hold rates steady while dropping its tightening bias underscored a shift toward neutral, narrowing the policy differential with the Fed and lifting the loonie. April’s industrial output ticked up modestly and employment remains firm, suggesting the economy can absorb a more gradual US rate path. On the trade front, renewed US–China negotiations, culminating in pledges to revive the Geneva framework and lift rare-earth curbs, have dampened global tariff fears that once hung over Canada’s export sectors. Finally, strong oil prices have buoyed Canada’s terms of trade and further supported the currency’s advance.