Investing in AUDCAD from 0.9540

As of March 25, 2026, the outlook for the AUDCAD pair looks quite optimistic. The Aussie has an advantage over the loonie due to a sharp divergence in monetary policy between the Reserve Bank of Australia (RBA) and the Bank of Canada (BoC). While the former remains hawkish, the latter keeps interest rates at a significantly lower level.

At its March 17 meeting, the Australian regulator raised borrowing costs by 25 basis points to 4.10%—the second consecutive hike. Governor Michele Bullock outlined the “material risk” that inflation could remain above the RBA’s target range for longer than expected because of the heated situation in the Middle East. As a result, markets are pricing in one more increase in May.

Now, let’s turn to the BoC. On March 18, the central bank held its rate at 2.25% for the third time in a row. Governor Tiff Macklem described the regulator’s current predicament: weak economic performance doesn’t allow officials to raise borrowing costs, yet the Iranian crisis keeps pushing crude prices and inflation higher. So far, the BoC is frozen in a wait-and-see mode.

For a better understanding of Australia’s and Canada’s macroeconomic landscapes, we should take into account their latest CPI, labor, and GDP data.

Inflation

Australia. The headline Consumer Price Index (CPI) is forecast to peak in mid-2026 at 4.2%. In the meantime, household inflation expectations have recently jumped to a three-year high of 6.1%.

Canada. February’s CPI report came in below 2%, but a sudden surge in energy costs to $100 per barrel and beyond threatens to derail the country's bright prospects.

Economic Growth & Labor Market

Australia. At the end of last year, the GDP grew faster than anticipated (2.6%), compelling the RBA to take decisive actions. Unemployment rose to 4.3%.

Canada. The national economy has seen better days. In the fourth quarter (Q4) of 2025, the GDP contracted by 0.6%. The jobless rate edged up to 6.7%.

The RBA-BoC policy gap (4.10% vs. 2.25%) makes AUD a more attractive option for investors than CAD. Over the past two days, markets have been flooded with news regarding a possible de-escalation of tensions surrounding Iran. In case these developments push oil prices lower, the crude‑dependent loonie could be less affected than the Aussie—especially if the RBA softens its rhetoric.

The overall recommendation is to buy AUDCAD from the 0.9540 level. Profits should be taken at 0.9695. Stop Loss could be set at 0.9450.

The volume of the open position should be calculated so that the potential loss (protected by a Stop Loss order) does not exceed 1% of your deposit. If your account balance does not allow opening a position of this size, it is better to avoid entering the market on this signal and wait for other trade options that meet low-risk criteria.