Kit JuckesChief Currency Strategist at Societe Generalediscusses the CAD outlook ahead of the Bank of Canada (BoC) interest rate decision.
USD/CAD and US rates: probably both have peaked
“Nobody expects a rate change. Yet futures traders have built up the largest short CAD position since January 2019, just after the Fed’s last rate hike of the cycle that began in late 2016. USD /CAD peaked above 1.36 after that rise, before falling in 2019.”
“USD/CAD tracks relative rates between the US and Canada, but by far the biggest driver of that spread is the trend in US rates.”
“We think USD/CAD has topped out and will turn back down towards 1.25 in the coming months, even if core CPI and a bland BOC policy statement don’t point to big surprises today.”
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
