Scotiabank economists update their USD/CAD forecasts. Now the pair is expected to trade above 1.30 over the next year.
The forecast for the fourth quarter rises to 1.35
“We mark fourth quarter forecast for USD/CAD up to 1.35 (from 1.30) and we raised the 2023 profile for the USD a bit.”
“Now only we expect USD/CAD to weaken below 1.30 next year“.
“Relatively strong growth, a hawkish central bank and high commodity prices have done little to curb USD/CAD’s rally this year, and it’s hard to see any of those drivers offering additional support to the CAD at this point.”
“The CAD is very strongly and positively correlated with US equities at present, and low risk appetite seems likely to persist as long as inflationary pressures are high and geopolitical tensions are high. This will keep the CAD tone soft.” “.
Source: Fx Street
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