Company: FXC
Filing Date: 2025-02-26
Form Type: 10-K
Source: 0000950170-25-027265
Chunk: 32

Company: Invesco CurrencyShares Canadian Dollar Trust
Filing Date: 2025-02-26
Form: 10-K
Item: Item 1
Chunk 32
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 sharply from mid-Feb to mid-Mar, with the dollar rebounding on signs of continued strength in the US labor market and inflation. Struggling commodity prices also capped the upside for the currency given the country is a major exporter of crude oil. However, the currency pair did rebound in the second half of March amid a weaker USD and the boost in energy prices. In the second quarter, while the pair was pretty range bound in April and May, the CAD really gained in June supported by the hawkish repricing of the BoC’s interest rate expectations while the US Fed paused. Despite its resilience, renewed dollar strength heavily pressured the pair in the third quarter, though the rebound in energy commodities limited the downside. In the fourth quarter, with the US dollar weakening on growing Fed rate cut expectations, the pair managed to recover significantly, reversing all earlier losses.

Additionally, the interest rate paid by the Depository has generally trended downward over the past year to thecurrent interest rate of 1.31%, as set forth in the FXC Rate Chart above. As long as the Sponsor’s fee and the interest expense on currency deposits, if any, exceed interest income, the Trust will incur a net comprehensive loss. 

Critical Accounting Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires the Sponsor’s management to make estimates and assumptions that affect the reported amounts of the assets and liabilities and disclosures of contingent liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the period covered by this report. 

In addition to the description below, please refer to Note 3 to the financial statements for further discussion of our accounting policies. 

The functional currency of the Trust is the Canadian Dollar in accordance with ASC 830, Foreign Currency Translation. 

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ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 

Except as described above with respect to fluctuations in the Canadian Dollar/USD exchange rate and changes in the nominal annual interest rate paid by the Depository on Canadian Dollars held by the Trust, the Trust is not subject to market risk. The Trust does not hold securities and does not invest in derivative instruments. 

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ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Index to Financial Statements

    Documents
     
    Page

    Report of Management on Internal Control Over Financial Reporting
     
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    Report of Independent Registered Public Accounting Firm (PCAOB ID 238)