Green Light for USD/CAD Weakness Still in Place - Westpac
Richard Franulovich, Research Analyst at Westpac, suggests that the
green light for USD/CAD weakness still in place, the pair likely to
trade down to 1.25 and beyond in coming weeks, amid more stable energy
markets and likely more upside surprises on Canadian growth as fiscal
stimulus washes through the economy.
“CAD appealing vs the likes of EUR and JPY as the major central banks the world over, from the Fed to the ECB, the BoJ and the PBOC, all tilt policy to underwrite growth prospects. CAD has plenty of multi week upside vs the likes of AUD and NZD too, the latter hamstrung by heightened RBA and RBNZ easing expectations, and related to that, a much lower infl ation trajectory in Australia and NZ vs Canada. The supply side adjustment in energy markets appears to be much more advanced than in iron ore too, the latter showing comparatively little.”