USD/CAD Sell the Rallies to 1.29/1.30 – Westpac
Richard Franulovich, Strategist at Westpac, has recommended selling the pair on strength toward 1.29/1.30 if seen.
“Near term outlook more neutral but a better seller into 1.29-1.30 if seen”.
“A slightly diminished terms of trade shock thanks to higher oil prices along with fiscal stimulus suggest H2 should see some upside growth surprises”.
“CAD continues to have appeal vs its commodity bloc brethren AUD and NZD, the latter hamstrung by heightened RBA and RBNZ easing risk, and related to that, a much lower inflation 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 if any meaningful rationalisation”.