USD/CAD to advance nicely over the coming months – Danske Bank
|Economists at Danske Bank maintain a bullish view on USD/CAD on a 3-12M horizon.
BoC to keep policy rates unchanged until Q1 2024
We maintain a bullish view on USD/CAD on a 3-12M horizon. That said, in the near-term risks are for a further setback to the broad USD given weakness in US figures and as markets price in the first rate cut for March. This is likely to benefit CAD albeit not by as much as other cyclically sensitive currencies.
We expect the Bank of Canada to keep policy rates unchanged until Q1 2024 when we pencil in the first rate cut.
A persistent move lower in the cross would likely require a stronger global growth backdrop than what we pencil in or a very ‘hard landing’ requiring a sharp easing of global monetary conditions, including a weaker USD.
Forecast: 1.34 (1M), 1.37 (3M), 1.41 (6M), 1.44 (12M)
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.