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    Canadian export values rose to $65.63B from $63.94B in December as overseas demand improved

    by VT Markets
    /
    Feb 19, 2026
    Canada’s exports rose to $65.63B in December, up from $63.94B in the previous period. That’s an increase of $1.69B. This increase points to stronger export values to close out the year. The data compares December’s total with the prior reported period. A new report shows Canadian exports increased to $65.63B in December 2025. This is a positive sign for the Canadian economy. It beat expectations and suggests that economic strength is carrying into the new year. That strength should also support demand for the Canadian dollar. Strong exports, along with January inflation at 2.9%, makes the Bank of Canada outlook less clear. In our view, it lowers the chance of an interest rate cut in the first half of 2026. Markets may now start to price in rates staying higher for longer. For currency derivatives, we would expect downward pressure on USD/CAD. The pair has been trading near 1.3450. This news could push it toward the 1.3300 support level seen last autumn in 2025. Consider put options on USD/CAD with expiries in late March or April. In interest rate markets, this data is a warning for traders positioned for near-term rate cuts. Short-term pricing could shift, including in Canadian Overnight Repo Rate Average (CORRA) futures. This may be a good time to hedge against the risk that the Bank of Canada stays more hawkish at its next meeting. A similar pattern appeared in the second half of 2024. Strong jobs and trade data repeatedly forced markets to delay expected rate cuts. That period saw a firmer Canadian dollar and more volatility in short-term bond yields. Today’s setup is starting to look similar. The next key catalyst is the Bank of Canada meeting in early March. We will watch their wording closely for any sign they are recognizing this resilience. Until then, positioning may still favor a stronger Canadian dollar and “higher for longer” domestic interest rates.

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